GST slabs could be reduced
Should the 'very rich' in India be taxed more for gold buys?
Kolkata/New Delhi - 3% rate on gold deemed too low
Published: Sat 12 Aug 2017, 7:54 PM
Last updated: Sat 12 Aug 2017, 9:56 PM
The number of tax slabs in the Goods and Services Tax (GST) regime would be reduced with improvement in revenue, Union Minister of State for Finance and Corporate Affairs Arjun Ram Meghwal said here on Saturday.
With the exempted category, the existing tax slabs are of five, 12, 18 and 28 per cent.
Defending the different slabs, he said the central government was trying to introduce the new tax system with the consent of states and did not want to impose it.
"The centre could have taken decisions in the GST council on the basis of majority but that was not done," the minister said at an interactive session organised by the Indian Chamber of Commerce.
Meghwal also said as many as 1.32 million new dealers have registered themselves in the system so far after the implementation of GST. Out of these, 56,000 were from West Bengal, the highest in India.
He said total number of registered dealers in the indirect tax system in the pre-GST regime was eight million. Describing the GST Network (GSTN) as a "perfect system", he said: "We must be facing some teething problems but it is a perfect system. The new system will remove inspector raj and there will be no human interface. The government will improve the GSTN system." He said the GST Council would take its decision on how to extend the excise duty benefits for the entities with operations in the northeast.
3% on gold too low
Meanwhile, the GST rate of three per cent on gold is low and needs to be increased as it is consumed by the "very rich", Chief Economic Advisor Arvind Subramanian said, author of the Economic Survey.
According to Economic Survey Volume II 2016-17, which tabled in Parliament on Friday, "the tax on gold and jewellery products - items that are disproportionately consumed by the very rich - at three per cent is still low."
The document also stated that there was a need to tax education and healthcare. "Keeping health and education completely out is inconsistent with equity because these are services consumed disproportionately by the rich," it said.
Health and education are outside the tax net altogether, exempted under the GST and not otherwise taxed by the centre and states.