GST led to increase in tax base, ease of trade: Piyush Goyal
New Delhi, Feb 1 (IBNS): The Goods and Services Tax (GST) reforms has resulted in increased tax base, higher collections and ease of trade, finance minister Piyush Goyal said while presenting the Interim Budget here today.
Seventeen different taxes levied by the Central and State/UT Governments with cascading effect of tax on tax, were consolidated into one GST. India became a common market. GST has resulted in increased tax base, higher collections and ease of doing business.
Goyal said: “The high taxation levied on multiple commodities in the pre-GST regime has been rationalised and the burden on the consumer, especially the poor and the middle class, has been significantly reduced.”
Most items of daily use of the poor and middle class are now in the 0% or 5% tax slab. Cinema goers who were subjected to multiple taxes up to 50% are mostly paying much lower tax at 12% now, the minister said.
Goyal said the government wanted the GST burden on home buyers to be reduced and accordingly, moved the GST Council to appoint a Group of Ministers to examine and make recommendations in this regard at the earliest.
Goyal said the GST aimed to benefit small traders, manufacturers and service providers. Exemptions from GST for small businesses had been doubled from Rs 20 lakh to Rs 40 lakh. Further, small businesses having turnover up to Rs. 1.5 crore have been given an attractive composition scheme wherein they pay only 1% flat rate and have to file one annual return only. Similarly, small service providers with turnover upto Rs. 50 lakhs can now opt for composition scheme and pay GST at 6% instead of 18%. More than 35 lakh small traders, manufacturers and service providers will benefit from these trader friendly measures. Soon, businesses comprising over 90% of GST payers will be allowed to file quarterly return.
The finance minister asserted that in spite of such major rate reductions and relaxations, revenue trends are encouraging. He said: “The average monthly tax collection in the current year is Rs. 97,100 crore per month as compared to Rs. 89,700 crore per month in the first year. The State revenues are improving with guaranteed 14% annual revenue increase for the first five years.”
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