At Thursday midnight, landmark unified indirect tax for the entire country started with formal launch of Goods and Service Tax (GST) regime.
Prime Minister Narendra Modi today termed the GST as a ‘good and simple tax’ which will end harassment of traders and small businesses while integrating India into one market with one tax rate.
At a gala event to launch the Goods and Services Tax (GST) at the historic Central Hall of Parliament, Modi said the indirect tax reform is a result of combined efforts of various political parties at different points of time. GST, he said, is an example of cooperative federalism as the centre and states together thrashed out the new law with consensus.
Besides being a transparent and fair system that will end generation of black money and corruption, GST will promote new governance culture that will end harassment at the hand of tax officials. Touching upon initial teething troubles that may be witnessed because of unification of more than a dozen central and state levies into one and switching over to a new online return filing system, Prime Minister said even eyes have to adjust for a couple of days when a sight corrective spectacles are worn. Modi said GST will eliminate the compounding effects of multi-layered tax system.
Pranab Mukherjee calls GST ‘disruptive change’
Calling the GST a “disruptive change”, President Pranab Mukherjee tonight said the ambitious central tax is a “tribute” to the maturity and wisdom of India’s democracy, as he recalled steps taken during his own tenure as Finance Minister on this key reform measure. He also said the GST Council should continuously review the implementation and suggest suitable improvements to the new indirect taxation regime.
“The new era in taxation, which we are about to initiate in a few minutes, is the result of a broad consensus arrived at between the Centre and states,” Mukherjee said minutes before the GST rollout in his speech at a special function in the central hall of Parliament. “This consensus took not only time but also effort to build. The effort came from persons across the political spectrum who set aside narrow partisan considerations and put the nation s interests first. It is a tribute to the maturity and wisdom of India’s democracy,” he said. The President termed the Goods and Service Tax (GST) a disruptive change.
“It is also a moment of some satisfaction for me because, as the Finance Minister, I had introduced the Constitution Amendment Bill on March 22, 2011,” he said. “It is similar to the introduction of VAT when there was initial resistance. When a change of this magnitude is undertaken, however positive it may be, there are bound to be some teething troubles and difficulties in the initial stages,” he said. Mukherjee said these issues have to be solved with understanding and speed to ensure that they do not impact the growth momentum of the economy.
