GST has already increased prices in Kerala. I do not know how people like Thomas Isaac supported it. The notion projected is that `Kerala will benefit, since Kerala is a consumer economy.’ There are two questions which come up from this observation: 1. Do you mean that Kerala government will get more money out of taxes, or that the people of Kerala will benefit? The answer is obvious. The people of Kerala will have to pay more, but Kerala government will get more money. So Kerala will benefit. 2. Does the LDF Government in Kerala have any role in upholding the federal system of Governance in India accepted by the Indian Constitution? With GST coming to the scene, the entire federal system in India is broken, since the taxes are completely centralised. LDF is answerable to these important questions rather than becoming a shadow of Narendra Modi in such crucial affairs, to protect the interests of the Keralites. This decision of GST has far reaching implications. I am relieved to read some sense from Prabhat Patnaik, who said: `The implementation of the Goods and Services Tax would mean that that the states would have absolutely no power in deciding what tax rates to impose on what commodities, a right that was given to them under the Constitution of India. Once you the GST, the freedom of the states to pursue alternative strategies goes, and you have an enormous centralisation of power. If you want any change in the rates, you have to go to the GST council, in which the centre has a substantial voice. Consequently the states would become completely dependent on the centre. It is violation of the federal structure of the Constitution and is against the basic structure of the Constitution. All kinds of ridiculous arguments, for instance that it is going to add 2 per cent to our GDP growth rate and so on, are bandied about which are based on econometric frauds, based on assumptions which make no sense whatsoever. GST is a demand of the corporate elements in the country. The State governments are being bought off by promises that their resource position is not going to worsen in the short run.’
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