Govt cuts GST rates with eye on assembly polls: Chidambaram

 Former Finance Minister P. Chidambaram

Former Finance Minister P. Chidambaram

A day after the Goods and Services tax (GST) Council brought down GST rates of several items of mass use, former Finance Minister P. Chidambaram questioned why it wasn’t done earlier and linked it to the next round Assembly polls.

In a series of tweets, the former Finance Minister also said GST continues to be “unreformed” and the government should move towards a single rate GST in the medium term.

“GST Council cuts rates on 100 items, approves quarterly returns. Belated wisdom. Why did Government not follow our advice in July 2017? When elections are around the corner, government cuts rates. I suppose that makes a good case for frequent elections in different states!” Mr. Chidamabaram tweeted.


“The present GST is still ‘unreformed’. Government must notify three rates immediately and signal its intention to move to a single rate in the medium term. That will be true GST,”he added.

Mr. Chidamabaram claimed that there are several lacunae in the GST law but doubted “if the government had the will or the skill to remove them.”

On Saturday, the GST council, made up of all the State Finance Ministers beside the union Finance Minister, announced a major overhaul of the tax rates on items such as refrigerators, washing machines, vacuum cleaners, among others.

A major demand by several women’s group and leaders to exempt sanitary napkins from GST was also accepted by the Council.

The move is being seen as a poll sop ahead of the next round of polls in Madhya Pradesh, Chhattisgarh and Rajasthan in November and December. A similar overhaul of tax rates, including reducing the rates on restaurants and eateries, was taken before last year’s Gujarat assembly elections.

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Printable version | Jun 27, 2022 7:43:39 pm |