Deputy Chief Minister and Finance Minister Mallu Bhatti Vikramarka has urged the Centre to ensure that proposed GST reforms do not adversely affect the revenue interests of States, pointing out that Telangana could face an annual revenue impact of over ₹800 crore from proposed changes relating to motor vehicles alone.

Addressing the 57th meeting of the GST Council on Wednesday, Mr. Bhatti sought that the full financial implications of changes concerning refunds on motor vehicles, capital goods and input services be shared with States before they were implemented.

GST accounts for about 35% of Telangana’s own tax revenue and any decline in collections would directly affect expenditure on schools, hospitals, welfare programmes and infrastructure, he said.

Mr. Bhatti said simplifying compliance for honest taxpayers and maintaining “zero tolerance” towards deliberate tax evasion should go hand in hand. He called for stringent action against fake GST registrations, fraudulent invoices and misuse of Aadhaar and PAN details. He said the identity details of elderly persons, homemakers and daily-wage workers were being misused in some cases to create fraudulent GST registrations.

He also drew attention to tax evasion in the scrap sector, where its largely unorganised, and cash-based nature was facilitating fake invoicing and fraudulent transfer of input tax credit.

Telangana proposed the constitution of a Group of Ministers under the GST Council to comprehensively examine issues relating to the scrap sector and identity theft and recommend an action plan.

He also urged the Centre to establish regional offices of the GST Network (GSTN) and the GST Council Secretariat in Hyderabad. Hyderabad’s strengths in technology, data analytics and artificial intelligence made it suitable, he said.

He sought a specific and transparent share for States from the Health Security and National Security Cesses to strengthen public health infrastructure.