'Don't scrap your contracts, negotiate GST rates on them'

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Fearing a delay in its proposed development projects, the state government has toned down its August 19 notification on scraping contracts and tenders due to non-inclusion of the GST system. It issued a fresh notification on September 11, stating that instead of cancelling the contract, the respective authorities can negotiate with contractors regarding rates in accordance with GST.

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A senior BMC official said, "As per the notification, contracts of supply items and other emergency works will not be affected. But, the respective departments are supposed to calculate GST on these contracts." According to the notification, authorities can negotiate in contracts awarded after July 1, where no work order has been issued. In contracts with work orders and for those in which work is currently on, they are supposed to take the help of the law department to get the exact GST that needs to be recovered or returned.

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