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    Published On : Sun, Dec 6th, 2015
    Business News | By Nagpur Today Nagpur News

    CAIT welcome & criticise GST panel led by CEA

    Nagpur: While welcoming proposal of levy of about 18% standard tax rate under GST by panel headed by Chief Economic Advisor Arvind Subramaniam and also proposing calling off 1% tax on inter-state transactions under GST, the Confederation of All India Traders (CAIT) criticised the panel for proposing multilevel taxes. ” The basic fundamental of GST is to bring an end to multiple taxation system and multiple Authorities regime but several proposals mooted by the panel are in contravention of fundamentals of GST”-said CAIT.

    The proposal of standard rate at 18% is genuine and reasonable keeping into consideration subsuming of various taxes under GST and withdrawal of 1% tax rate on inter-state transactions will avoid cascading effect-said CAIT.

    CAIT National President B. C. Bhartia and Secretary General Praveen Khandelwal said that beside above two proposals, the other recommendations are more academic and lack basic principles of taxation under a developing economy. Proposing a tax rate of 12% for essential commodities is certainly cruel in nature since commodities consuming by masses are categorised as essential commodities and as such are generally placed under exempted category. On the other hand proposal of levy luxury items under 40% tax rate seems to be unrealistic as a commodity luxury to one section may be a necessity to another section. The term luxury is very vague and needs to be defined first.

    Both Bhartia & Khandelwal said that it appears that the panel has worked more on assumptions rather than considering the ground realties. It is a fact that panel never consulted stakeholders who are the real carriers of GST. The proposal of different level of tax rates will make the compliance difficult and the tax net may not be get widen.

    They said that Single Tax with Single Authority, uniform law and uniform tax rate across the Country will be an ideal and simplified GST which will not only encourage self compliance but will make the tax net widen and the States will gain higher revenue. The complexities of the taxation system should be dispensed with. They urged the Government to initiate a straight dialogue with stakeholders on GST.

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