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GST rates slashed from today: Lowered tax on tanks, armoured vehicles shows lack of faith in homemade weaponry

As of Wednesday morning, one can go shopping for chocolates, aftershave lotion and shampoo with a lowered GST, slashed from 28 percent to 18 percent.

If you have a large enough shopping bag and don’t live in an apartment, one can also buy a tank and a couple of armoured vehicles with their GST having been dropped even further to 12 percent. Except for wet grinders, this is the sharpest cut of all in the 178 item list.

Why have armoured vehicles been made into a public commodity is inexplicable and one wonders as to how many aspirants would there be for this exotic purchase. Imagine the gas bill.

A file image of Arjun main battle tank. Image courtesy: Wikimedia Commons

A file image of Arjun main battle tank. Image courtesy: Wikimedia Commons

Can one even buy one seeing as to how it is a prohibited item... and does it come with shells?

Besides churning up the roads and turning it into water cannon to dispel rioters, what are the other applications that one can think of the ten-tonne monster? One could possibly hire it out on a timeshare basis like the business jets that are available on fractional ownership.

But, so as to be little serious after the laughter has died and the humour run dry, isn’t military hardware purchase a government initiative? And what difference does it make what the tax bracket is if you are using official coffers? Whether it is main battle tanks, armoured personnel carriers, self-propelled rocket launchers or light track recce vehicles (all included in this benediction), a private enterprise has no say in the sale. Also, why would a manufacturer pay taxes for you to buy his goods?

What's the advantage in taxing yourself?

And if this placement along with wet grinders is curious, it is also indicative of the fact that India’s armoured corps are not well served by the indigenous Arjun series tanks. They seek as many as 2,000 (although 1,700 is the current figure, it should go up) future ready combat vehicles, so what difference does it make what the price tag is on these armored carriers. These are the new ultramodern tanks that India had planned to design and manufacture under what could rise to an $8 billion deal.

But is there a crisis of faith that the FRCV will not be up to scratch and will take far too long to become a reality?

The government could well be having second thoughts on this investment what with the Arjun tanks not pulling their weight in multi-national exercises and the story of the 34-year-old sorry saga of the Tejas light combat aircraft (LCA) now a legend and still unlikely to see the daylight till 2025. We do not have a particularly exciting reputation for homemade weaponry. With such a massive armed forces one would think that India would have had built a tangible and impressive military industrial in seventy years instead of being held hostage by the spare parts clauses of many deals. And, of course, the perennial middlemen. In this aspect, there is more scandal than substance.

Regardless of where we go shopping, the reduction of taxation on military vehicles in a consumer-oriented reworking of the GST still stands out like a sore thumb. These deals are made from government to government, and one can hardly see India dealing for these dubious goods with arms dealers who might occasionally augment weaponry to incumbent authority besides supplying their usual revolutionary freedom fighters and their dark avatar, the terrorists.

Just recently US President Donald Trump indicated he was going to okay a sale of high-grade hardware to Japan and South Korea to combat Pyongyang.

The awkward linkage of armoured vehicles with wet grinders, which are civilian construction equipment, has produced considerable humour. What is odd is the government hasn’t seen it necessary to explain this anomaly.

Updated Date: Nov 15, 2017 10:11 AM

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