The GST Ex­pe­ri­ence

Governance Now - - BRIEFINGS - Fi­nance Min­is­ter Arun Jait­ley on one year of the GST

“it has been one year since the coun­try’s switchover to a new in­di­rect tax­a­tion sys­tem - the good and ser­vices Tax. one sin­gle tax re­placed seven­teen taxes and mul­ti­ple cesses im­posed by the cen­tral and the state gov­ern­ments. This had ob­vi­ously ne­ces­si­tated ev­ery as­sessee to file mul­ti­ple re­turns, have an in­ter­face with mul­ti­ple in­spec­tors and as­sess­ing au­thor­i­ties, suf­fer the cas­cad­ing ef­fect of hav­ing to pay tax even on the tax com­po­nent al­ready paid, hav­ing to pay tax separately in ev­ery state when move­ment of goods took place, to suf­fer the in­or­di­nate de­lays of mul­ti­ple check­points and ob­sta­cles, and be­ing fed up with the tax­a­tion sys­tem, de­vises mea­sures on how to by­pass the tax sys­tem. The very foun­da­tional idea of the goods and ser­vices Tax was not orig­i­nal. it had been ex­per­i­mented in sev­eral coun­tries of the world. The in­dian model had to be de­vised keep­ing sev­eral facts in mind. an in­di­rect tax, un­like a di­rect tax, is re­gres­sive. in a coun­try where di­verse sec­tions of pop­u­la­tion with dif­fer­ent pay­ing ca­pac­i­ties, ev­ery­body pays the same rate of tax, the rate can­not be dif­fer­ent for the wealthy and the not so wealthy as in the case of a di­rect tax. But in the se­lec­tion of the com­modi­ties which are tax-free or less taxed, a dif­fer­en­tial could be made in a so­ci­ety like In­dia. se­condly, in­dia had mul­ti­ple mar­kets, each con­sti­tut­ing a dif­fer­ent mar­ket which needed to be con­sol­i­dated. Thirdly, the essence of in­dian fed­er­al­ism had to be re­spected. in­dia is a union of states where both the union and the States have to be fis­cally strong. A weak Union is detri­men­tal to both na­tional sovereignty and growth and weak states won’t be able to de­liver de­vel­op­ment. in­dia is not a con­fed­er­a­tion of states and, there­fore, strength­en­ing of state rev­enues can­not be at the cost of cen­tral rev­enues. if the union does not sur­vive, what will hap­pen to in­dia i.e. ‘Bharat’ – the union of states?” –

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.