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Goods & services tax

GST tweak to ease inflation

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"Eventual agenda, logically for the government, was to bring in one-nation-one-tax. At the same time, the presumption was to improve tax collection with higher tax rates. It is difficult to presume what the number (of revenue from GST) is going to be by the end of the financial year. However, subsequently, there could be a circumstance that six months down the line when everything stabilises they (the government) will look at what is the actual collection and then decide on whether certain products should go in higher or lower brackets. That is because, logically, there can't be a situation where the government can say fine, I will fetch revenue from some other kitty and compensate the state governments. It has to eventually come from the indirect tax basket,"

Suresh Kumar Rohira
Partner, Grant Thorton India LLP

This article appeared in DNA India on 13th November, 2017.