GST cut, and the way the khakhra crumbles

Mission Gujarat:Prime Minister Narendra Modi at the Dwarkadhish Temple in Gujarat on Saturday.PTI  

The decisions of the Goods and Services Tax Council on Friday to lower the tax slabs for 27 broad categories of goods and provide relief for small traders by changing the frequency of e-filing from monthly to quarterly have got the thumbs-up from the Bharatiya Janata Party.

In Gujarat, which is going to the polls later this year, Prime Minister Narendra Modi especially referred to the reduction of GST on the traditional snack of khakhra and other savouries of the State from 12% to 5%. The exemptions given to yarns used for nylon and polyester, viscose and rayon and man-made fibres were good news for textile hubs in the State. The relief on waste glass was important for the glass industry in Vadodara. The relief in e-filing is also aimed at the BJP’s traditional base among traders.

The BJP’s increasing shift in political rhetoric to rural and agricultural communities had been making its traditional strongholds of traders jittery. Monthly e-filing was weighing on them heavily. “With these moves, we are convinced that any hard feelings will now be over,” a senior party leader said.

Traders’ response

In a statement, Praveen Khandelwal, secretary of the Confederation of All India Traders and treasurer of the Delhi unit of the party, said: “Enabling composition dealers to make inter-State sales is a bold decision, and will allow traders to remain competitive.”

“Increase in the composition scheme up to Rs. 1 crore, deferment of e-way bill and reverse charge mechanism will boost business sentiment in the country. Quarterly return for persons having an annual turnover of up to Rs. 1.5 crore will give much relief to small traders and take off the load of monthly tax compliance,” he said.