Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 16-8-2018 – Time and again, there is a demand being raised by GST stakeholders from various quarters on the number of GST rate slabs in India. Under a now 14 months old GST regime in India w.e.f. 1st July, 2017, Goods and Services Tax (GST) is levied and collected under four broad tax rates, viz, 5%, 12%, 18% and 28%. However, there is a upper ceiling of 40% GST rate under the law upto which GST would be levied. Presently only a handful of nations have 3 or more rates. There are only 5 countries where four or more tax rates are in force. About 50 countries have just one tax rate while about 30 countries have two tax rates. Apart from these specific tax rates in India, we have zero rated supplies, exempt supplies and supplies with nil rate of GST. In certain cases, there are special rates as in case of textiles, footwear, jewellery etc. To top up the revenue and balance the tax rates, a Compensation Cess is also levied o
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
to have annual growth rate of 7-8 percent in next few years which is considered to be a fastest in last few years, rationalization of GST rates could benefit industry as well as tax administration, besides reducing possible litigation on rates and classification disputes. The IMF report has fore cast the GDP growth. @ 7.3 percent for financial year 2018-19 and @ 7.5% for financial year 2019-20 taking into account investment and strong private consumption. It states that India is recovering from the after effects of demonetization in November, 2016 and implementation issues in GST. India is also benefiting from good macro and stable economic policies backed by other socio economic reforms in recent past. International Monetary Fund (IMF) has recently in its annual report expressed that India is on a track to be one of the fastest growing economy in the world and that further rationalization of GST inter alia, would give maximum benefits including labour reforms for companies to expand.
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
e simplified without sacrificing progressively of the current GST and with potentially significant gains from lower compliance and administrative costs. Streamlining of exemption would also contribute to progressive tax regime. GST is also expected to increase the amount of economic activity taking place in the formal sector of the economy. Though GST Council, the apex decision making body for GST is seized of the matter and is authorised to make recommendations in this behalf, following form of rationalization may be looked at: Present Rate Proposed Rate Zero / Nil Zero / Nil 5% 6% 12% 15% 18% 28% 25% This may later be further rationalized with zero percent and 25% percent still being on the board. As the countrymen become used to GST, revenues build up, compliances increase and people respecting reasonable profiteering with seamless input tax credit mechanism, India should look at a median rate of 10 to 12 percent by converging all other rate slabs. Going forward, this should be the
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =