GST rates will have no inflationary impact: Jaitley

GST rates will have no inflationary impact: Jaitley
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NEW DELHI: Allaying apprehen­sion of spike in prices of goods and commodities after the roll out of the GST, Finance Minister Arun Jaitley Wednesday said the tax rates will be kept at the current levels so as not to have any inflationary impact.
Introducing four bills to give effect to the Goods and Services Tax (GST), Jaitley said the legis­lations will have to be passed by Parliament and one by each of the state as­semblies to turn India into one market with a single tax rate.
The Finance Minister said the aim of the GST Council is to decide eve­rything relating to the tax structure with consensus and this is for the first time that such an arrange­ment has been made, based on the principle of shared sover­eignty of both the Centre and the state governments.
“These are revolutionary bills which will benefit all. …States have pooled in their sovereignty into the GST council, and Centre has done the same,” he said. Prime Minister Narendra Modi and sev­eral senior members of the Union Cabinet were present in the House when the four bills were taken up for consideration and passage.
The bills are the Central Goods and Services Tax Bill, 2017, the Integrated Goods and Services Tax Bill, 2017, the Goods and Ser­vices Tax (Compensation to States) Bill, 2017 and the Union Territory Goods and Services Tax Bill, 2017. Explaining the bills, he said the Central GST or CGST will give powers to the Centre to levy tax after levies of excise, ser­vice tax and additional cus­toms duty is subsumed. The Integrated GST or IGST will be a tax to be levied by the Cen­tre on inter-state movement of goods and services.
The States will pass the State GST or SGST law that will allow them to levy sales tax after levies like VAT are subsumed. Besides, GST com­pensation law allows for impo­sition of cess on certain luxury goods like tobacco, high-end cars and aereated drinks to create a corpus for compensat­ing states for any loswws of revenue in the first five years of GST roll out.
The fourth law introduced is on Union Territory GST or UTGST for UTs like Chandigarh and Daman and Diu which do not have assemblies. Jaitley said all decisions on GST would be taken by the GST Council, reflecting the federal structure.

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