GST rate structure needs complete overhaul: Adhia

: With the new GST regime firmly entrenched, a complete overhaul of the tax rates is now required to reduce the burden on small and medium businesses, revenue secretary Hasmukh Adhia has said.

He said the Goods and Services Tax (GST), which amalgamates more than a dozen central and state levies like excise duty, service tax and VAT, will take about a year to stabilise.

Nearly four months since its introduction, the new indirect tax threw up teething troubles and compliance issues, which the GST Council -- the highest decision-making body of the new regime -- has addressed through several rounds of changes.

To ease hassles facing medium and small businesses in paying taxes and filing GST returns, it has tweaked various aspects of the new indirect tax regime to make it industry friendly. Also the GST Council has rationalised rates on over 100 commodities and made refund process easier for exporters.

“There is a complete overhauling that is required... it is possible that some items in the same chapter are divided. So ideally we should do harmonisation of items chapter wise and wherever we find there is a big burden on small and medium businesses and on common man, we have to bring them down. Then only there will be a better compliance, a better acceptability of GST,” Adhia said.

He, however, said the overhauling would require some calculations by the fitment committee, which will decide which items need a rationalisation of rate under the GST regime which kicked in from July 1.

NEW DELHI