West Bengal finance minister Amit Mitra has asked Union finance minister Nirmala Sitharaman to undertake a course-correction in the functioning of the Goods and Service Tax Council, where he cautioned that a steady breakdown of the spirit of cooperative federalism was taking place.

In a letter to Sitharaman, Mitra said that commitment towards working out a consensus was getting eroded, and said that an undercurrent of the Centre coming to meetings with pre-determined conclusions was emerging.

“I write this letter with great anguish. Many of us have observed a steady breakdown of the spirit of cooperative federalism and the erosion of the commitment to work out a consensus in the GST Council Meetings,” Mitra said in the letter. ET has seen a copy.

“I urge you Hon’ble Minister to kindly introspect on what I have taken the liberty of bringing to your attention with utmost sincerity and frankness, so that you may consider a course correction in the manner of functioning of the GST Council,” he said.

He urged Sitharaman to rebuild the trust in the Council by listening to members, cutting across party lines and regional diversities.

He added that states will respond in equal measure if a consensual atmosphere that had defined the GST Council since inception is brought back.

Mitra said that consensus for the simplest matters was becoming elusive, as opposed to previous instances where the GST Chair yielded to a lone voice from a state leading to all states converging despite reservations. He also pointed to the vehement debates during the formulation of the GST laws, underlining the consensus building.

“Unfortunately, today we find the prevalence of a narrow view of political majoritarianism prevailing in the GST Council,” he said.

He noted instances where hours of submissions were made by states but no final conclusion was declared in the meeting, however the GST Chair – Sitharaman – announced the conclusion in the press conference that followed.

“What pains me the most is the fact that GST Council meetings have become acrimonious, vexing and almost toxic with erosion of mutual trust that had held fast between States and the Centre since the inception of the GST Council,” he said.

He added that consensus building was critical at present when states’ revenues are in dire distress with a growth of (-) 3% during FY21, the gap between protected revenue and revenue collected has ballooned to Rs 2.75 lakh crore and the actual compensation due to the states for 2020-21 has reached Rs 74,398 crore.

Mitra reiterated the conduct of the GST Implementation Committee (

) which has amended rules, bypassing the GST Council and presenting them only for the information of the GST Council instead of discussion and ratification.

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