The center government was losing revenue because of the GST which must be revenue neutral with the single rate, Economic Advisory Council to the Prime Minister chairman Bibek Debroy.
He addressed an event organized by the Calcutta Chamber of Commerce and mentioned that GST directed to a lot of simplification.
The economist specified that an ideal GST would be that which comprises a single rate and would is to be revenue neutral. The Finance Ministry’s computations when the GST was launched state that the average rate must be 17% at least. However, 11.4% is the current rate. As of the GST the revenue is been losing by the government.
The public and the members of the GST Council wish the 28% tax rate to narrow down however no one wishes the 0 and 3% tax rates would rise, Debroy mentioned.
Through that method, we will never have a facilitated GST,” he stated at the ‘Special Session on Resilient and Self-Sufficient India’. He added that a “lot of abuse” of GST provisions was taking place.
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The EAC-PM chairman stated that the ultimate objective of tax changes for direct taxes should be the total abolition of all exemptions.
Any exemption, he claimed, complicates things, raises the expense of compliance, and encourages lawsuits.
Debroy stated that when the government is required to spend it requires revenue of 10% of Gross Domestic Product (GDP) should get spent on health and education, 3% on defence, and 10% on infrastructure. However, we taxpayers contribute around 15% of the GDP in taxes. This indicates that while we pay 15% in taxes, we actually anticipate and demand 23% from the government.
