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GST rate may increase on many goods and services, government’s aim to increase revenue

Friday - December 13, 2019 11:47 am , Category : BUSINESS
The GST collection shows a contradiction against the hope of Modi government
The GST collection shows a contradiction against the hope of Modi government

The GST collection becomes a cause for concern for the Modi government 

DEC 13 (WTN) - As you know that due to the global economic slowdown, the economies of the entire world including India have a significant impact. According to the International Monetary Fund, 90 percent of the world's economies have been affected by the global economic slowdown. As far as India is concerned, the global economic sluggishness of the Indian economy, which is among the ten largest economies of the world, has seen a lot of impacts.  

In the auto sector to the textile sector, almost every sector of India has been affected by the global economic slowdown. From low production to short-term shutdown in the industries and unemployment, these are the results that The Indian economy has been affecting due to economic slowdown, and that is why GST collections are declining. As you know the Modi government had implemented GST with great hope and enthusiasm, but the figures of GST collection are proving to be disappointing for the Modi government. 

Due to the reduction in the GST collection, it may be that the GST rate on some goods or services may be increased soon. For your information, let us know that the revenue recovery of GST so far has not been satisfactory and for this reason, the revenue collection of the Center and the states has come under a lot of pressure. It is being said that on December 18, some big decisions can be taken in the meeting of the GST Council headed by Finance Minister Nirmala Sitharaman. 

In fact, the meeting of the GST Council is being held at a time when the GST collection is falling short of expectations and many states have not even received compensation. In order to get the pending compensation, the state governments are pressuring the central government to compensate for the compensation as soon as possible. Due to this, there is a possibility that the government may increase the GST rate on some goods and services, or then increase their slab. 

It is being said that the change in GST rate on luxury goods and services can be discussed and a proposal to increase GST rates on them may also be passed, thereby increasing the GST collection. At the same time, the demand of the states is that the lowest slab in GST is 5 per cent, so it should be increased from 6 to 8 per cent. At the same time, the states demand that the 12 per cent rate of GST should be increased to 15 per cent. 

For your information, let us know that there are four rates in the GST at this time. The first-rate is 5 per cent, the second rate is 12 per cent, while the third rate is 18 per cent and the fourth rate is 28 per cent. At the same time, cess is also levied on goods and services falling in the category of 28 per cent slabs. For information, let us know that this cess can be between 1 to 25 per cent. 

At the same time, according to the information received from the media, the GST slabs can also be merged in the meeting of the GST Council and the presently existing 4 slabs can be reduced to 3. Not only this, but the council can also consider the exemptions given under GST. At the same time, the council can also decide whether some services can be levied or not? 

According to economists, this time the meeting of the GST Council can prove to be very important for the general public besides the central and state governments. As you know, the recovery of GST and Cess has been very less for the last few months. In such a situation, due to the constantly decreasing GST collection, many goods and services can be placed in the already high GST slab. At the same time, cess can also be imposed on some services, so it is natural that if this happens, then the burden will be directly on the general public.