Army wants its purchases excluded from GST to maintain operational secrecy, efficiency

The Indian Army wants its purchases to be excluded from Good and Services Tax (GST) – the one-tax regime brought in by the Modi-led NDA government in July 2017.

“We have moved the government and have flagged the issue prominently,” a senior Indian Army officer said requesting anonymity.

Under the new tax regime, every purchase over Rs 2.5 lakh attracts GST. “Army units move frequently” and units need to register for GST separately since it is “state specific”, sources said, and added that “no local purchases can be made till a fresh registration is done”.

Indian Army units move at least once every two years. Instances when units are moved every year are not rare either. Importantly, some units are also deployed across state borders for operational reasons creating an accounting and administrative “nightmare,” the sources said.

Besides, having to register afresh for GST every time units move, the Indian Army has said that “geography-specific” GST registration gives out the deployment details of individual details units. “We are not very comfortable revealing the deployment details or geographic location of units,” the sources said.

The Army has suggested that they be completely exempted from paying GST or alternatively Principal Comptroller Defence Accounts (PCDA) – tasked to audit and maintain accounts of the military – register themselves under GST. These GST registrations then can be used by units, the sources said.

By: India Today

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