Extend period of GST compensation: Party
THE PARTY WILL PUSH THE POLICY CHANGES AS A PART OF ITS 2024 MANIFESTO
UDAIPUR: The compensation period to states for any loss of revenue under the Goods and Services Tax regime, which ends in June, must be extended by another three years, given the challenging economic situation and poor financial health of the states, the Congress party demanded on Saturday.
India must also “reset” its economic policies, 31 years after the government ushered in economic reforms, to take into account “global and domestic developments” as well as “social inequalities” and tweak the policies “for the next 10-20-30 years,” it said. The party will push the policy changes as a part of its 2024 manifesto.
Addressing the media at the Congress’s Chintan Shivir, former finance minister P Chidambaram demanded an extension of the compensation period and announced that the party would “strongly disapprove” any attempt of the government to prevent the GST Council from seeking such an extension.
The GST law allowed a five-year period for compensating states of any loss in tax revenues after the implementation of the Goods and Services Tax in July 2017. The compensation window ends in June.
Thirty one years after he accompanied Manmohan Singh, then finance minister, in ushering liberalisation through economic reforms in 1991, Chidambaram, who was then commerce minister, now pitched for another “reset” in economic policies. “We believe that we must prepare the Indian economy and the Indian workforce to adapt to the ways in which industry, business and trade will be conducted in the 21st century, with the greater use of automation, robotics, machine learning and artificial intelligence,” he said.
Recalling his first experience in policymaking in 1991, Chidambaram said, “We are now 30 years down the road. The world is changed, India is changed. A reset means taking into account global and domestic development and fine tuning the policies that have obviously given us benefits, but clearly a time for reset has come.”
“While we acknowledge that we have reaped enormous benefits as a result of liberalisation, we have to take into account global and domestic developments, and reset our policies for the next 10-20-30 years,” he added.
He described the current state of economy as “a matter of extreme concern”, slammed the Reserve Bank of India for falling “behind the curve” in tackling inflation and said: “Inflation has risen to unacceptable level. The WPI (Wholesale Price Index) is at 14.55% and the CPI (Consumer Price Index) is at 7.9%. There are high taxes on petrol and diesel and high GST tax rates. The job situation has never been so low, with 40.38% job participation rate and unemployment rate at 7.83%.”
“The consequences of the poorly drafted and unfairly implemented GST laws brought in by the Modi government in 2017 are there for everyone to see,” he said.