The government will consider a review of the 28% Goods and Services Tax (GST) levied on cement, Union Finance and Corporate Affairs Minister Finance Minister Nirmala Sitharaman said on Tuesday, while asserting that the government will cope with whatever fresh shocks that may emerge from global factors.
“Is there a buffer in the Budget? Buffer or no buffer, we have to face the situation as it arises,” Ms. Sitharaman said at an interaction with industrialists.
“We did so in the case of fertiliser prices in 2021 which rose out of nowhere. But we didn’t let the farmers down, we imported as much and more, and also didn’t shift the burden on the farmers. It was not that I had a provision [in the Budget] for that already,” she pointed out to Confederation of Indian Industry (CII) members.
Responding to a suggestion by infrastructure sector veteran Vinayak Chatterjee to consider a reduction in the 28% GST levied on cement, which he termed “a bit unnatural” as it is used by many non-bulk individual buyers who are unable to access input tax credits, Ms. Sitharaman responded positively.
“On the GST, the end user in non-bulk cases… you are talking about individuals. Bulk cases, of course, it can be government or private sector undertaking projects. I see your point. Let’s see. I will have the fitment committee look into it and then, if necessary, take it to the [GST] Council,” she replied.
Mr. Chatterjee, chairman of the CII mission on infrastructure, trade and investment, had emphasised that lowering GST on the building material would help reduce the cost of government projects as well as infrastructure in general, while higher volumes would ensure revenue buoyancy was not affected.