Congress Criticizes GST Revamp as Incomplete, Calls for Simplification

New Delhi, Sep 4 (PTI) - The GST Council's recent comprehensive revamp of the Goods and Services Tax (GST) regime has met with varied reactions, with the Congress dubbing it as "GST 1.5" while expressing that the anticipation for a "true GST 2.0" is ongoing. The opposition party has also urged that all states receive compensation for five years, based on 2024-25 as the base year, due to concerns about revenue impacts from rate reductions.

Congress president Mallikarjun Kharge reiterated the party's long-standing demand for a simplified GST. "Over the past decade, we've consistently advocated for the simplification of GST," he stated. Kharge criticized the current administration, accusing them of transforming 'One Nation, One Tax' into 'One Nation, Nine Taxes' due to the multiple tax slabs and rates.

Highlighting the Congress's vision, Kharge mentioned that their 2019 and 2024 manifestos called for a simplified GST 2.0 and a reduction in complicated compliances adversely affecting MSMEs and small businesses. Kharge also recounted the history of GST in India, noting its formal announcement in 2005 by the Congress-UPA government and its subsequent opposition by the BJP during its initial stages.

Kharge took a dig at PM Modi's administration for previously opposing GST and now celebrating its revenue collections. He remarked on the taxation burden on farmers, along with daily essentials like milk, curd, and even educational supplies, dubbing it as "Gabbar Singh Tax".

"Two-thirds of GST is paid by the poor and middle class," Kharge claimed, labeling the Modi government's policies as disproportionately affecting these groups while reducing Corporate Tax rates. Income and GST collections have surged over the past years, he noted.

Kharge acknowledged the government's recent efforts regarding rate rationalization but insisted that states should be compensated for the potential revenue impact. He emphasized that simplifying GST compliance is crucial for benefiting MSMEs.

Congress general secretary Jairam Ramesh echoed the sentiment, stressing the need for cooperative federalism by extending state compensations. He underscored the Congress's advocacy for a streamlined GST that reduces rates on mass consumption items and simplifies compliance.

Ramesh raised questions about the role of the GST Council, following announcements by FM Nirmala Sitharaman and the Prime Minister's anticipatory remarks during his Independence Day speech. He criticized the design of GST 1.0, describing it as counterproductive, and awaited whether GST 1.5 would truly benefit industry growth and MSMEs.

The article noted expected price reductions on common items and insurance following the GST Council's decisions. Slabs for rates are said to be streamlined to 5% and 18%, effective during Navaratri.

Former finance minister P Chidambaram labeled the GST revamp as an overdue "U-turn", welcoming the changes while lamenting its delayed implementation. Chidambaram asserted that the Congress has long highlighted flaws in GST's design and rates, criticizing the government for its past defenses.

In recent statements, Chidambaram expressed that the reforms are welcome but delayed, speculating on possible motivations, including economic factors and political considerations. The GST revamp aims to stimulate consumption and domestic spending amidst global trade challenges.

(Only the headline of this report may have been reworked by Editorji; the rest of the content is auto-generated from a syndicated feed.)