GST to convert entire country into one market: Patnaik

Jay Anderson
May 20, 2017

"This GST council meet in Srinagar is an attempt to erode financial autonomy of the J&K State", said Dar.

At the meeting held today, the tax rate of almost 1,205 items were finalised. The GST rate on coal has been fixed at 5 per cent, down from 11.69 per cent of tax now charged.

The meeting of the GST Council, headed by Jaitley and consisting of state finance ministers, kicked off here today. France was the first country to implement the GST in 1954.

"The GST will bring about comprehensive reform of the indirect tax regime of the country".

These items at present attract 22-24 per cent tax incidence through a combination of central and state government levies. Besides, for demerit and luxury goods, a cess will be levied on top of the peak rate.

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FMCG firms Dabur and Emami welcomed the rates on commonly used consumer items stating it would be beneficial but said more clarity is needed to understand overall impact. The chief minister also stated that the tax reform would result in benefits to business and industries and consumers as well.

He further said that the new tax rate "will be adverse for the Ayurvedic medicines category and that too at a time when the government has been talking about promoting traditional Indian alternative medicine".

As per estimates, the GST is expected to shore up government revenue and spur economic growth by 1-2 percentage points.

The International Monetary Fund (IMF) had earlier this year said the GST could help raise India's medium-term GDP to over 8 per cent and create a single national market for enhancing efficiency of movement of goods and services.

The special session will be held on May 18 and 19, official sources said on Wednesday.

Other reports by BadHub

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