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GST Rate Simplification- Modi Government’s Constant Fine Tuning and Congress Empty Rhetoric

On December 22, 2018 the 31st GST council meeting announced major rate cuts. Now, only 34 luxury items are under tax net of 28%, and all other items are either taxed at 18% or below. The decision of GST council that made services supplied by banks to basic savings accounts and Jan Dhan accounts exempt from GST reaffirms government’s commitment to ease the lives of common people. It is to the credit of this government that it first cleared the deadlock over Goods and Service Tax (GST) and later finely tuned the impact of GST on various sectors and made the interventions accordingly as explained in our earlier article. The present revision also can be seen as a part of such fine-tuning exercise, where the Ministry of Finance hears out the different views of the GST council members representing various states and arrives at a consensual outcome.

Is This an Occasion for Congress to Take Credit?

It is a known fact that the Congress President Rahul Gandhi uses a scare-mongering term ‘Gabbar Singh Tax’ for GST, ignoring the fact that all the daily usage goods have been either exempted or put in the 5% bracket from the beginning itself. Recently, he tweeted to indicate that the government is bringing some changes in GST and he claimed this is because of the pressure put by his party.

But the basic difference between the Modi government’s systematic approach and the chaotic ideas of Congress is too obvious.

Congress would want to take credit for now since NDA govt is gradually bringing most of the items under 18 percent under GST, as the smooth implementation of GST is taking place. But Rahul Gandhi led congress wanted all items to be taxed at single rate of 18 percent.

Here we document how Rahul Gandhi and Congress batted for only one rate of GST where Mercedes car and milk being put in the same slab!

Here is how Congress and P. Chidambaram too spoke in the same language.



Acknowledgement to Government

However, even if the Congress party tries to claim credit, there are many who have already given credit to where it is due. The tweets from cinema industry echo the sentiment. Below are the tweets from industry veterans Karan Johar, Ajay Devgn, Akshay Kumar and Aamir Khan.




Meanwhile, far from getting credit, if news is to be believed Congress was sabotaging the GST rate cut.


The Congress stance on GST has been of an impractical nature and often based on empty rhetoric. Whereas, the Modi government, right from the beginning, put in a great deal of effort to bring in consensus and exhibited the spirit of co-operative federalism which UPA lacked.


You may read our earlier pieces for the detailed explanation and perspective on this issue.