GST regime has ‘very efficiently’ brought tax rates down: FM

Finance Minister Nirmala Sitharaman said on Tuesday that the Goods and Services Tax (GST) regime has “very efficiently” brought tax rates down and consumers now pay lower levies than they did in the earlier indirect tax regime.

Finance Minister Nirmala Sitharaman said on Tuesday that the Goods and Services Tax (GST) regime has “very efficiently” brought tax rates down and consumers now pay lower levies than they did in the earlier indirect tax regime.

Ms. Sitharaman also urged businesses staying out of the GST system to come within its fold or risk losing prospective customers, adding that such economic activity is not captured properly and that formalisation is essential to assess the “true strength” of India’s economy.

“Consumers know today that post-GST, the tax rates they pay do not have double taxation, or overlaps, and therefore, they are paying far less tax today for essential goods and services than what it was [during the] pre-GST era. GST has actually very efficiently brought the rates down,” Ms. Sitharaman said after inaugurating a GST Sewa Kendra in Vapi, Gujarat.

The belief that firms can benefit by staying out of the tax net and “you don’t get to be noticed” is misplaced, the minister said. “But you’re losing out on potential buyers of your products. So all these messages will have to be conveyed from now. I would want equal attention to be given for collection of tax, whose numbers are going up every month, and [getting] more establishments enrolled. The country should benefit from having a transparent tax regime in which everybody participates,” she summed up.