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| Congress demand rejected by Modi | | | The BJP led NDA Government has
rejected the Congress demand for a uniform 18 per cent rate under the GST on the plea that it could lead to inflation in rates of foodgrains and essential items. Well Finance Minister, Arun Jaitley, has indicated that if the tax collections under the GST improved the Government may remove products from the 28 per cent slab which could lead to rationalisation of slabs. Prime Minister Narendra Modi has ruled out a single tax rate under the GST, saying a Mercedes car and milk cannot be taxed at the same rate and accepting the Congress' demand for a uniform 18 per cent rate would lead to a spike in cost of food and essential items. Modi said the Goods and Services Tax has within a year of its launch led to an over 70 per cent jump in indirect taxpayer base, demolished check-posts and merged 17 taxes and 23 cesses into one single tax.
Hailing the GST rollout in India in its first year as one of the smoothest in the world, Union Minister Arun Jaitley held out hope for consumers by indicating removal of products from the 28 per cent slab and rationalisation of slabs, subject to improvement in the GST collections. The Modi government's narrative to mark the first anniversary of GST Day was to strike a reconciliatory tone by profusely thanking the states and the political parties for the GST rollout success, thereby invoking "collaborative and cooperative federalism". Jaitley indicated that as the GST collections improve, many more items from the 28 per cent category can possibly come down. "Only sin products and luxury goods can remain there," he said
Well the Central Government has to meet various demands from the people of India besides India is committed to release financial aid to various undeveloped nations and this exercise requires tax collection improvement. In addition to this the centre is supposed to provide financial assistance to the state hit by natural calamities and the state of Jammu and Kashmir is a clear case where since 2014 the centre has been providing liberal financial assistance whenever the state is tormented by flood fury. In addition to this centre needs huge funds for the development of railways and the National Highways. The biggest drain to the centre is its duty to maintain huge number of Armed Forces besides CRPF and BSF. Since the rise of Pakistan sponsored militancy in Jammu and Kashmir state the centre is supposed to reimburse security related expenses which includes sanction to raising of additional police battalions and for rebuilding and renovation of police stations. The biggest financial requirement of the centre is to upgrade its weaponary, ammunition and explosives that too when India is surrounded by two unfriendly nations, Pakistan and China. |
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