Secret of 28% GST rate

Taking a dig at former finance minister Arun Jaitley now hinting at slashing items attracting the highest 28% GST (Goods and Services Tax), senior Congress leader on Saturday said:

"The 28% GST was the contribution of a lazy BJP government that simply added the Excise, VAT and CST."

He was reacting to Jaitley's article on Friday that the pre-GST tariff was a Congress legacy when the standard rate for central excise plus VAT plus CST was 12% + 14% + 2% and multiciplity of taxes had eventual cascading effect to hit 31%.

Chidambaram tweeted: "BJP government berushed aside the report of the CEA (chief economic adviseer) and summarily dismissed our plea to cap GST rate at 18%. Now it claims wisdom in phasing out the 28% rate!" In another tweet, he said 28% rate (and the cesses) was only one aspect of the faulty implementation of GST. There are other distortions that have given GST a bad name." "Following demonetisation, the faulty implementation of GST destroyed thousands of SMEs and millions of jobs. Ask any trader or businessperson and you will know the truth," Chidambaram said. Since he referred to CEA Arvind Subramanian whose advice on GST and other economic issues was brushed aside, Chidambaram remembered to point out that "today is Dr Arvind Subramanian's last day in office."

"We wish him the best and hope he will return one day to advise a liberal, reform oriented and receptive government," he added on his Twitter handle.