AAP labels GST on research grants as 'tax terrorism', seeks withdrawal

The Aam Aadmi Party (AAP) slammed the BJP-led central government on Saturday over the imposition of Goods and Services Tax (GST) on research grants, describing the move as "tax terrorism".

The party also demanded a withdrawal of the tax on research grants.

For the first time in history, a government is imposing a tax on grants received by research institutes, AAP general secretary (organisation) Sandeep Pathak said at a press conference.

The Modi government has issued a notice to all institutes, proposing to impose GST on research grants received since 2017, he said, adding that it was a double layer of taxation since a part of the grants is used on consumables and equipment that are already taxed.

Research grants are not taxed in any developed or developing country such as the USA, the UK, Germany, South Korea or Singapore. Imposing GST on research being done for the development of mankind and the country is "tax terrorism", Pathak charged.

The Rajya Sabha MP also lashed out at the government for "stifling" innovation and progress by taxing research meant for the nation's development and demanded it be withdrawn in the next meeting of the GST Council.

A show-cause notice has been issued to all premier institutes that they will have to pay GST on all research grants they have received from 2017 till now. The government has demanded GST of around Rs 220 crore from these institutes, including IIT Delhi, Pathak said.

"If the government does not withdraw this policy, AAP will raise its voice against this proposal on every appropriate forum and will make every possible effort to make the government withdraw it," he asserted.