The move to issue Goods and Services Tax (GST) notices to local taxi operators has taken the taxi lobby, which till now has been defying a change, by surprise. The North Goa Taxi Association has reacted sharply calling it ‘revenge tactics’ by the government for refusing to come under an app-based system. Currently, around 263 taxi operators have received the notice for GST compliance. There are over 18,000 registered taxis in Goa.
The decision comes barely three months after Transport Minister Mauvin Godinho made an impassioned speech in the monsoon session of the Legislative Assembly where he charged the private taxi operators with causing a massive Rs 500 crore loss to the treasury by avoiding paying GST.
As Goa grapples with the dual challenges of promoting tourism and maintaining the livelihoods of its local service providers, this move calls for a measured understanding of its implications and fallouts keeping the taxis and the broader economic landscape in mind. The decision to enforce GST compliance raises crucial questions about fairness, sustainability, and the long-standing troubles within the State’s transport sector.
There is no doubt that private taxis have been defiant all along for varying reasons and have refused to accept any of the government’s proposals. All options put forth have been shot down with utmost disdain. However, the question now is whether bringing taxis under the ambit of GST can help regulate and streamline the services. Can this move be a game-changer that would eventually put taxis in line?
The private taxis have been resisting government control over their businesses because their incomes are purely based on a fluctuating tourism season coupled with the uncertainty of business routes. Further, there is the fear of losing control to a third party in an aggregator-based system. On the other side, private taxis have been accused of charging exorbitant fees with an inconsistent and unorganised fee structure.
Given the situation, there is every possibility that the taxis will increase their fares even higher to leverage the GST component, and in doing so could end up charging more than they were doing earlier. This will have a ripple effect forcing tourists to look at other modes of transport or increasingly rely on rented vehicles. That could be disastrous in view of the chaos and nuisance caused by these vehicles on the roads.
Secondly, many of the taxis are unorganised and do not even issue a proper bill, or maintain books of accounts. It remains to be seen whether the operators will now show transparency in disclosing the volume of business.
The enforcement of GST comes against the bleak reality that many taxi operators are not well-versed in tax regulations. The complexity of compliance often overwhelms smaller providers who may lack financial literacy or the means to seek professional advice.
It’s time the taxi operators understand the need for accountability, and whether one likes it, or not or sees it as revenge tactics, due processes need to be followed. Instead of resisting the change, leaders of the taxi lobby must reconcile to the change that is before them and adapt accordingly. Introducing a tax on the private taxi business appears to be a move to put the sector on track and get the taxis into a more organised eco-system. The question is whether the government succeeds this time. Time will tell.
