Review GST rates, solve industry from trouble: Capt to PM

CHANDIGARH: Punjab chief minister Captain Amarinder Singh, on Sunday, wrote to the Prime Minister seeking a review of the GST rates from the point of simplification, and urging him to ensure that it is set right to mitigate, difficulties that the trade, business and industry were facing.

In his demi-official letter, the CM urged Prime Minister Narendra Modi for quick redressal of some irritants in the GST in the spirit of cooperative federalism.

The CM pointed out that the GST was a reform in which the country as whole and political parties, irrespective of their affiliations and beliefs, had come together for national good. “Despite reservations, states have supported all the initiatives for reform and simplification of our century-old archaic tax system,” he added.

Among the key expectations from GST were simplification of the tax laws and processes, GDP rise, moderation in prices and boost to the tax revenues. Somehow, the experience of the last one year has been more bitter than sweet, added Amarinder. Noting that the experience of the last one year showed many drafting and structural deficiencies in GST laws, CM said innumerable deviations made from standard provisions elsewhere had introduced tax distortions.

“Successive reports by the committees constituted by the GST Council had recommended many changes, as, as per my understanding, the Law Review Committee, comprising both the Central and state government officials, had proposed nearly 200 changes,” he said.

“Many global experts feel that single rate has far greater advantages and the poor should be compensated through direct benefit transfers so that rich do not benefit from these concessions,” he added.

The CM cited examples from day-to-day life of multiple taxes for many goods that had very little to distinguish from each other. “There is a strong rationale to review all tax rates from the point of view of major simplification which shall also curb evasion and leakages,” the CM added.

Expressing concern that GST revenues had not shown the kind of buoyancy that was expected, Amarinder said this was worrisome not only on the account of the impact it would have on the precarious financial position of the Governments but also the restraint it would place on the government expenditure and consequentially social justice and development.