March 28, 2018
Government’s Chief Economic Advisor Arvind Subramanian on Wednesday said that he wanted a simpler GST structure.
Speaking with reporters on the sidelines of an event, the CEA said although added that once the GST Council is confident that the revenue through indirect tax is stabilising, it will do more simplification future.
On the issue of GST collections being lower than government’s target of Rs 92,000 crore, Arvind Subramanian said that at Rs 86,000 crore, the collection is not bad, and in future, there is enormous scope for increasing tax buoyancy. The Goods and Services Tax (GST) launched from July 1, 2017, was criticised for multiple tax brackets as it made the regime complex.
The World Bank in its half-yearly India Development report said that India’s GST is most complex in the world and has the second highest rate in the world. Among the 115 countries which have the GST system, India’s five tax slabs of 0, 5%, 12%, 18%, and 28% make it most complex in the world. However, Finance Minister Arun Jaitley on multiple occasions said that even as the GST, in essence, is ‘one nation, one tax’, in a huge and diverse country like India one tax is not possible.
The GST Council in past few months rationalised tax rates on as many as 200 items from the 28% and 18% tax brackets to lower ones. Arun Jaitley also said that once there is enough revenue buoyancy, the 28% tax bracket will be limited only to sin goods.
Meanwhile, to curb tax evasion, the government will roll-out E-way bill from April 1 for movement of goods beyond 10 km radius.While simplification of GST returns in on cards for the GST Council, there is no update on the inclusion of the real-estate and petroleum under the indirect tax regime.
[The Financial Express]