FRIDAY’S SOLUTIONS

money, hence the government is making efforts to augment revenue collections,” the second official said, adding that the government may also reduce personal income tax rate to boost consumption. But the move will depend on its implication on the overall revenue, the official added. Hindustan Times had on October 1 reported about the possible move.

In the interview, Debroy said “it (a personal tax rate cut) is inevitable” with elimination of exemptions. “When it will happen, it is for the finance minister to announce,” he said. A similar view was expressed by NITI Aayog vice-chairman Rajiv Kumar, as reported by NDTV on October 4. “I have heard that there are demands of personal income tax rate cuts and I am fully confident that the government is holding consultations and discussions on this matter,” NDTV quoted Kumar as saying.

The Prime Minister’s Office is constantly monitoring the country’s growth revival efforts and, on Friday, it cautioned states to share the responsibility of GST administration failing which they might face troubles after the compensation period is over in 2022, the third official said. It expressed concerns over falling GST revenue at a meeting with senior officials of states on Friday.

“It is also essential that GST revenues stabilise to ensure not only that states do not face fiscal stress when the compensation period is over in 2022, but also provide adequate revenues to finance development expenditure of states and centres,” an office memorandum of the GST Council Secretariat, issued on Thursday, said. Concerned about the fall in GST collection, the government on Thursday appointed a committee of central and state government officials to ascertain the reasons for the decline.