File picture of Union Finance Minister Nirmala Sitahraman.
| Photo Credit: ANI
The Goods and Services Tax (GST) regime has benefitted people via a pro-poor method, Union Finance Minister Nirmala Sitharaman asserted on May 6, whereas underlining that the latest landmark of GST collections crossing ₹2 lakh crore was pushed by heightened financial exercise.
Under the GST framework, taxes on many important gadgets have been decrease in comparison with pre-GST charges, the Minister stated, citing the examples of hair oil and soaps (all the way down to 18% from 28%), and electrical home equipment (diminished from 31.5% to 12%) and film tickets.
“Reflecting a pro-poor approach, the effective weighted average GST rate has consistently fallen since 2017. The Revenue Neutral Rate was suggested to be 15.3% but was lower at 14.4% in 2017, and it has come down to 11.6% in 2019,” Ms. Sitharaman postulated.
“Further tax rate rationalization has been done since 2017. National Anti-profiteering Authority ensured that companies passed the benefits to the consumers. GST has exempted many essential items and services, such as unbranded food items, certain life-saving drugs, healthcare, education, public transport, sanitary napkins, hearing aid parts, agricultural services, etc,” she identified.
Noting that the concept of GST was first mooted underneath the Atal Behari Vajpayee-led NDA authorities, Ms. Sitharaman stated that the UPA authorities was unable to attain political consensus on its implementation, whereas the mandatory compact was “carefully built” underneath Prime Minister Narendra Modi’s management.
“Before GST, India’s indirect tax system was fragmented and complicated, and every state was practically a distinct market in itself with different rules and tax rates. Inputs for central excise duty, etc, could not be availed, leading to an increased tax burden for the common people,” Ms. Sitharaman stated in a assertion. The GST streamlined 17 taxes and 13 cesses into a 5-tier construction, and diminished 495 submissions and filings throughout States to simply 12, simplifying the tax regime, she stated.
Stressing that GST simplified compliances via uniform processes, easy registration, single returns, and a absolutely IT-driven system with minimal bodily interface, Ms. Sitharaman cited a survey that discovered 88% of micro, small and medium enterprises (MSMEs) credited the tax for lowering prices and optimising provide chains.
While the variety of registered taxpayers underneath GST grew to over 1.4 crore from 65 lakh in 2017, 44 lakh small taxpayers and MSMEs have utilised the Quarterly Returns with Monthly Payment (QRMP) scheme that entails a lot decrease compliances, she stated.
“GST has enhanced MSME financing through tools like e-invoicing, TReDS, and the Account Aggregator framework,” the minister emphasised, including that the E-way invoice system eliminated inter-state checkpoints and lowered logistics prices.
“Trucks travelled 44% more daily, and corruption at tax ‘nakas’ decreased. Consequently, domestic goods’ inter-state trade surged to 35% of GDP in 2021-22, up from 23.5% in 2017-18,” Ms. Sitharaman stated.
