Mumbai: In an exclusive interview to CNBC TV-18 on Wednesday, chief economic adviser (CEA), Arvind Subramanian backed last weeks' rate cuts by the GST Council that has hinted at a further rationalisation of the new five-tier indirect taxation system. Subramanian, who sounded optimistic on recent developments on GST front, said the rate cuts by the Council will not have any major impact on government's revenue. There will also be no major effect on India's fiscal deficit, he said.
The GST Council last week moved 178 items out of total 227 goods and services in the top 28 percent slab to the standard 18 percent bracket. The Council also said from 15 November, there will be only a 5 percent tax rate on eating at restaurants other than the five-star hotels.
While announcing the reduced tax rates, finance minister Arun Jaitley had said hotels or restaurants will no more get input tax credit as, according to him, they were not passing on the benefits of the provision to the customers.
Subramanian in his interview further said the government was looking for an administrative simplicity in the GST regime and for that it was considering fewer tax rates. On a query on cement which still was left in the top slab of 28 percent, Subramanian said cement was a big contributor to the tax revenue. "The GST Council will take a call on the issue in a few months," he said.
According to the chief economic adviser, the compliance burden for filing returns under GSTR II and GSTR III categories has reduced significantly. The Council will also decide on the issue of land and real estate which are likely to be included in GST system. On exports front, the CEA said non-oil exports growth is much better than the figures of past 8-9 months.
Published Date: Nov 15, 2017 12:03 pm | Updated Date: Nov 15, 2017 12:56 pm