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GOVERNMENT OF INDIA TAKES A NEW DECISION ON GST

By Nanki Ahluwalia . 24th July 2018 02:00pm
GOVERNMENT OF INDIA TAKES A NEW DECISION ON GST

In a bid to win over the public’s heart the government of India has taken a new  move i.e. to slash levies on more than 50 goods which will in turn lower revenue by as much as Rs 15,000 crore ($2.2 billion) each year. A panel of central and state finance ministers late on Saturday cut the goods and services tax on items from washing machines and lithium-ion batteries to stone-carved deities and sanitary napkins as Prime Minister Narendra Modi looks to boost sentiment and growth before he faces re-election next year. Revenue loss will be minimal, interim finance minister Piyush Goyal told reporters at a subsequent briefing in New Delhi without elaborating. However, officials who didn’t wish to be identified as they aren’t authorized to speak to the media, shared a figure that works out to be as high as 1% of tax budgeted to accrue to the federal government. The administration can ill afford to forfeit revenue as rising oil prices threaten to widen India’s fiscal deficit and global borrowing costs rise. The new GST rates are effective July 27 and the panel will meet again on August 4 to discuss issues faced by small businesses. Finance Ministry spokesman DS Malik didn’t reply to a phone call outside of business hours on Sunday.