India's GST Dynamics: Navigating Towards a Unified Tax System
Union Finance Minister Nirmala Sitharaman stated that while GST slab rationalization is underway, India is not yet ready for a single-rate GST. The current four-rate system was established through careful alignment with state-level taxes. Reforms aim to simplify the system for the poor and middle class.
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Union Finance Minister Nirmala Sitharaman announced on Thursday that India is on its path to rationalizing the Goods and Services Tax (GST) slabs, though a single-rate GST system is still a future possibility. Her remarks were made during an event in Kolkata, where she addressed the complexities of the current system.
Sitharaman clarified that the four-rate GST structure, comprising 5, 12, 18, and 28 percent, was meticulously designed to align with various state-level taxes. This structure was not arbitrarily chosen but resulted from a detailed and collaborative review process.
Highlighting ongoing reform efforts, Sitharaman emphasized the aim to simplify GST, underscoring its significance for creating a unified national market by eliminating state barriers. She also mentioned further documentation to showcase GST's impact and reforms, especially in reducing rates on common-use items.
(With inputs from agencies.)
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