Centre wants TN govt to waive its GST share on elevated road projects

CHENNAI: The Union Ministry of Road Transport and Highways (MoRTH) has sought to waive the State component of GST for 4 major elevated road projects including Maduravoyal-Sriperumbudur and Tambaram-Chengalpattu to make the project more financially feasible.

The National Highways Authority of India has proposed to take up 4 elevated corridors – 23.2 km Maduravoyal-Sriperumbudur section on Chennai Bengaluru Highway, 10.4 km Madhavaram junction to Outer Ring road on Chennai-Kolkata Highway and 27 km Tambaram-Chengalpattu section of the Grand Southern Trunk Road and 14 km Tiruchy-Thuvakudi stretch of Tiruchy Thanjavur highway.

Sources said that the Union Minister of Road Transport and Highways Nitin Gadkari has written to Chief Minister MK Stalin seeking to know the State government’s decision on waiving GST for the projects. Gadkari had brought up the issue of waiving the GST with State Public Works, Highways and Marine Port Minister EV Velu and Principal Secretary of the State Highways Department during a meeting held in New Delhi on January 4 this year.

Officials of the State Highways Department said that the State government had already waived royalties on minerals like gravel, earth burrow and aggregate used in the construction of the major NHAI projects. “Why does the State have to give up on its GST share? How many other states have agreed and given up on their share? Anyway, the NHAI will be collecting user fees from motorists for using the elevated stretch to recover the project cost,” they said.

A senior NHAI official said that the discussions are being held at the ministerial level as the projects involve considerable investment and the State government’s share of GST was 9%.

“The cost of royalty waiver would be 0.1-0.2% of the total projects,” the official said, adding that already some states are waiving the GST component.