The impact of goods and services tax on Indian army is very deep and has taken the overall debt up to 5 thousand crores. As earlier it was known that the Indian army is lacking basic necessities like ammunition, arms, assault rifles, battle tanks and bulletproof jackets, now it is again under the burden of goods and services tax of up to 5 thousand crores applied by the Indian government.
All the 3 forces are heavily impacted by the new tax laws and customs duties which had created hurdles for the army on the monetary front. Rashtriya Rifles, the Army’s anti-insurgency force responsible to counter the issue in Jammu and Kashmir is also shortened with 136 crores of funds needed for the modernisation drive of the army.
The battalion regularly executes the campaign to catch hold of terrorists and cease other militants activities across the Jammu and Kashmir and is now under the monetary shortage. While the Indian army recently stated these issues in front of the Parliament’s Standing Committee on Defence, on this matter the panel stated that this time the army will have to pay the required amount of GST due to the changes in tax laws.
The panel stated that “an additional burden of Rs 5,000 crore will be levied on the Army because of the new taxation laws in the form of GST. This has not been accounted for in the current year’s Budget for the Army.”
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Revenue Budget comes in hand for the day-to-day operations, including maintenance of weapons, the supply of ammunition and fuel while the panel suggested to the government that it should sincerely watch over the budget deficit factor of Indian army which is a tune of INR 9282 crores.
The deficit revenue budget summarises compulsory requirements under transportation (Rs 889 crore), maintenance works (Rs 1,413 crore), supplies (Rs 1,419 crore, ordnance store (Rs 5,425 crore) and Rashtriya Rifles (Rs 136 crore).
The shortage of funds has led Army vice-chief Lt General Sarath Chand to state the as many as 25 Make in India projects will have to be closed. The Indian army was also going through the modernisation program for more than 125 projects and for which Rs 21,338 crore were allowed. Ironically the allocated budget has been short of an earlier prosed amount and made some stance over the allocation strategy.
The Indian navy is also under the crunch of goods and services tax as it will have to spend more than 800 crores for the debt payment of taxes earlier which stood at 427 crores in the last fiscal. COming to the Indian Air Force, the security wing had paid a service charge of around 934 crores in the duration 2016-17 which is lesser than the now charged 1614 crores in the 2017-18. Also, the amount had not been disbursed to the IAF according to the sources.
Overall the panel suggests a better plan for the budget allocation this year to counter the shortage of monetary issues of the army wing of India.
