Revamped GST: A New Era for India's Tax System
Finance Minister Nirmala Sitharaman has taken steps to ensure a smooth implementation of the new GST structure set to launch on September 22. The GST Council has simplified tax slabs, reducing them to two main rates, to stimulate consumption and potentially bolster GDP growth.
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- India
The Indian government is preparing for the seamless introduction of a reformed GST structure. Spearheaded by Finance Minister Nirmala Sitharaman, the initiative includes reducing tax slabs from four to two, effective September 22, aiming to simplify the tax system and encourage economic growth.
During a recent PTI interview, Minister Sitharaman elaborated on the measures being undertaken to upgrade the GST Network's IT systems. These updates are crucial for accommodating the tax reform, as businesses must adjust their ERP systems within the coming weeks to comply with the new rates.
The revised GST will feature two main tax rates at 5% and 18%, along with a 40% rate for certain luxury and tobacco products. This structural shift is expected not only to ease the tax burden on goods like soap and small vehicles but also to boost consumption, potentially offsetting the predicted GST shortfall.
(With inputs from agencies.)
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