(Guinness Record Holder for letters in Newspapers)
Prime Minister at special mid-night Parliamentary session on 30.06.2017 for launch of GST termed full form of GST as Good and Simple Tax. But GST in its present form is full of complications and complexities. Goods and Service Tax-GST is launched to simplify the tax-system. But its rate-structure unfortunately is complex through imposition of cess over maximum GST-rate of 28-percent. Also GST-rates are not in multiples of some common factor. Best would have been to have GST-rates in multiples of six at 6, 12, 18, 30 and thereafter in multiples of 30 like 60, 90, 120 etc. A smaller GST-rate of 3-percent for some very specific commodities and services like on gold jewellery and transport-service could be logical. It is illogical to have five-percent GST on transporation-services where net profit-margin is much-much lower. Raising minimum GST-rate marginally from five-percent to six-percent could pave way for abolition or reduction of GST on some other commodities.
Instead of creating confusion and chaos, a much simpler GST system could have been to impose GST at basic manufacturing only replacing excise-duty leaving other trade-channels totally tax-free. Distribution of total GST collected between centre and states could be done by evolving some consensus formula by GST council according to population and other factors of the state. Such a simplified system would have resulted in tremendous tension-free growth of trade and industry paving way for economic growth and overall prosperity of nation and its people. There are numerous ways to practically check generation of unaccounted money and tax-evasion for creating a voluntary tax-regime rather than creating unnecessary tension, confusion and complexity by bringing all trade-channels in GST-chain.
Labels: GST, News-Events, Tax, Useful Informations