The states aren’t in favor of accelerating GST rates at a time when there’s a slowdown in consumption and it’s not the proper time to scale back the number of slabs under the products and Services Tax (GST), Sushil Kumar Modi Said the Deputy Chief Minister of Bihar and therefore the coordinator of the group of ministers on IGST on Saturday.
There is no possibility of any change within the Goods and Services Tax (GST) rates until revenues stabilize, Modi said when he spoke on the subject ‘India: Roadmap to a $ 5 billion economy’ in 92. a FICCI Annual Convention here.
I want to assure you that not one state … (and) the union government is prepared to extend tax rates, he said.
At a time when the economy is in the slowdown, if you can’t reduce the rate to extend consumption, don’t increase rates also. It currently reduces tariffs and tax rates, and doesn’t increase them, Modi said.
On the chances of a discount in GST rates, he said: Until such time that GST revenues don’t stabilize, we cannot consider lowering tax rates. In fact, there’s no possibility of any change in slabs and tax rates, increases or cuts, in the near future.
There has been a deficit in GST revenue collection against projections. It crossed the Rs 1 lakh crore mark after a three-month gap in November with revenues growing 6 percent to Rs 1.03 lakh crore during the month.
The collection was Rs 95,380 crore in October.
Modi also reported that from now on the GST Council has decided to think about any change in tax rates just one occasion a year and rather than doing so at each and each meeting.
The last GST Council meeting happened earlier in the week, where the govt set a consistent rate of 28 percent for state and personal lotteries, which can be effective as of March 2020.
In the various previous meetings of the GST Council, the govt reduced the rates of varied services and goods, within the middle of which the GST collections remain below expectations, with the aim of boosting demand.
He also said that it’s not the proper time to scale back the number of slabs under GST of the present five (0, 5, 12, 18 and 28 percent) to three slabs.
Modi, who was Bihar’s minister of finance when the VAT (VAT) was administered within the country, said he’s closely monitoring the execution of GST and enriching the method with lessons learned from eight different countries.
Compared to the amount before the GST, 99 percent of products and services have fewer taxes levied after the GST, he said.
Fake billing has become a serious problem and therefore the government is trying to find ways to regulate the threat, Modi said.