The Goods and Services Tax (GST) Act implemented by the National Democratic Alliance (NDA) Government at the Centre was a revolutionary step to streamline taxation and boost economic development, N. Vishwanath Bhat, convenor, BJP State Economic Cell, has said.
Speaking to presspersons here on Monday, Mr. Bhat said that GST was a consumption-based taxation system and it would help ensure better collection of taxes in the coming days. Further, this uniform system of taxation would significantly bring down the cost of production.
The cost of transportation too would come down as GST has done away with the check-post system. It would remove multiple taxation and help sell India-made goods at competitive prices in the international market, he said.
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To a query, Mr. Bhat said that GST was not harmful for the trading community as reported in a section of the media. Instead, it was a friendly taxation system for the merchant class.
The government has made it clear that all trading activities up to ₹ 20 lakh annual turnover would not come under GST.
In case of businesses with an annual turnover in the range of ₹ 20 lakh to ₹ 75 lakh, the tax fixed was 2 % for manufacturers, 5 % for hotel industry and 1 % of the total turnover for others. There may be some sort of confusion in the beginning. But everyone would realise its benefits gradually, he added.
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Mr. Bhat said that GST would prove beneficiary for the common people as it had imposed 0 % to 5 % tax on essential commodities. GST would help combat black market as it compels all private entrepreneurs to come under the orbit of taxation.
All these days, nearly 50 % of the transactions in the private sector were done through cash and it was facilitating generation of black money.
A report by the Federal Reserve of the U.S. has predicted 4 % GDP growth in the next four to five years due to the implementation of GST. It would help mitigate the rate of unemployment, he added.
Mr. Bhat pointed out that the NDA Government at the Centre has taken some radical steps to boost economic growth. No scandals have been reported so far.
The rate of inflation which was 12 % when the NDA Government came to power has come down to 3 % today. Most of the State government’s schemes, including the popular Anna Bhagya scheme are run with the Centre’s assistance.
In this scheme, the Centre bears ₹ 29 per one kg of rice whereas the State’s share was ₹ 3, Mr. Bhat said.
BJP State vice-president M. Nagaraj and others were present.