As the Capital gets ready to implement the Goods and Services Tax (GST) from July 1, Chief Economic Advisor (CEA) Arvind Subramanian on Monday addressed MLAs here about how the new tax regime would work.
Dr. Subramanian said many States, including Delhi, would start seeing benefits with the rollout, with tax revenue expected to increase within three to four years.
Five-year compensation
Responding to a question by Malviya Nagar MLA Somnath Bharti, the CEA said “very few States are going to lose” as most States were consumers, not producers.
He said the three or four “producing” States would face small losses, which is why the Central government had extended five-year compensation to them.
Dr. Subramanian further said it was important that all States were united in the implementation of the structure.
Sovereignty on booze
With the exclusion of liquor and real estate from GST, which Deputy Chief Minister Manish Sisodia and others pointed out, Dr. Subramanian said that on alcohol “States will have sovereignty”.
Mr. Sisodia had raised concerns over the two sectors being left out of GST, saying that it might have been done to benefit “influential” businessmen.
