Asserting that the Modi government was forced to reduce the GST rates on many items because of pressure from the people and Congress’s opposition, party vice-president Rahul Gandhi said on Saturday that his party would continue to fight for a single rate and an 18% cap on tax rates.
“India needs a simple GST, not a ‘Gabbar Singh Tax’. People of India and the Congress fought to bring down the rates of many items under the 28% slab. Our struggle will continue to have a single rate and an 18% cap. If the BJP doesn’t do it, Congress will show how to do it,” Mr Gandhi tweeted on Saturday.
In his reaction to the substantial reduction in rates announced at the GST Council meeting in Guwahati on Friday, former Finance Minister P. Chidambaram tweeted: “Ministry of Finance must be complimented for ‘improving’ macro-economic situation in 4 months and 10 days! This is the time taken for common sense to germinate, flower and ripen into a fruit.”
Continuing its criticism of the GST as a “flawed tax system”, the Congress’ communication chief Randeep Surjewala on Saturday said, “instalment-based tinkering reflects the chaos and adhoc-ism of the the BJP government.”
“Multiple tax rate slabs are a fatal flaw. ‘One Nation One Tax’ has become One Nation Seven Taxes,” said Mr. Surjewala. He said for the indirect tax regime to become truly uniform, exempted categories like petroleum products, real estate and electricity need to come under GST.
Agriculture, textiles hit
He also claimed that agriculturists have been hit as tractors and other equipment, fertilizers, pesticide and cold storage facilities all are being taxed between 5 and 18 per cent under GST.
The Congress said textiles, the second biggest employment generator after agriculture, continued to face deep stress owing to a distorted duty structure.
“What Modi government does not realise is that while the fibre is taxed at 12%, the end-product, fabric, attracts a tax of 5%. This is threatening the livelihood and profitability of non-integrated textile players of man-made fibre (70% of total), while helping the big fish to make huge profits,” Mr. Surjewala said.
