H. Rajesh Prasad, Commissioner, GST, New Delhi, said on Monday that the Goods and Services Tax (GST) was based on the concept of pooled sovereignty and cooperative federalism. He was delivering a lecture on ‘One nation – One tax’ organised by Mahatma Gandhi Memorial (MGM) College, here.
Mr. Prasad, an IAS officer and an alumnus of the college, said that GST had widened the definition of business. It was a consumption-based destination tax. There was dual GST – State GST (SGST) and Central GST (CGST) on intra-State transactions. There was Integrated GST (IGST) on inter-State transactions and imports. There was Union Territory GST (UTGST) on transactions in union territories.
GST had already been implemented in 160 countries. India had joined this group since July 1. As many as 17 indirect taxes including the Central Excise, Service Tax, Value Added Tax and Central Sales Tax had been subsumed under GST.
Several taxes led to leakages and corruption. There was seamless flow of input tax credit. The GST was a self-policing mechanism, Mr. Prasad said. Later, at an interactive session, replying to a question on the need for a CGST and a SGST, Mr. Prasad said that ideally there should have been one tax. But the states had different views on this and were not ready to give up all powers.
He said that 20 meetings of the GST Council had been held. The next meeting was scheduled at Hyderabad on September 9.
Replying to a query on the high tax on luxury goods, he said that the nation needed taxes for development and progress. It had been the policy of the government to impose less tax on the common man and more on the rich. Hence, the tax on luxury goods was more. The people were not paying more after the GST than they were under the VAT, Mr. Prasad said.
