GST rates still leave room for pruning

 

GST rates still leave room for pruning

The Centre has reportedly favoured a pause in further rate cuts on the goods and services tax (GST) due to the revenue(आय/राजस्व) shortfall, estimated at over Rs 40,000 crore in the first quarter of this fiscal(वित्तीय/राजकोषीय सम्बन्धी) . This is hasty(जल्दबाजी /आतुर) , on two counts. The slew of changes that have periodically(समय-समय) been brought about show that the tax system has stabilised(मज़बूत/स्थिर) neither in terms of the rate structure(संरचना/बनावट) nor in categorisation(वर्गीकरण) of goods and services. There are too many rates now and some rates are still way too high. Rates must be lowered, converged(परिवर्तित/मिलना) to three to bring down classification disputes, and boost collections. The final GST structure should become stable to achieve a sustained increase in collections. Two, GST-induced revenue changes occur in direct tax collections above the trend(झुकाव/प्रवृत्ति), not just in GST collections per se.

The levy(वसूल करना/आरोपित राशि) creates multiple audit trails in the income and production chain that have the potential to tap untaxed income. Revenues from Central GST, IGST, the proceeds from personal and corporate income tax, and customs duties are a part of the divisible(विभाज्य/बँटने लायक) pool of taxes. States would be entitled(हकदार/स्वत्वाधिकारी) to a 42% share in direct tax collections above the trend. This should be factored in, and only the balance need be compensated(मुआवज़ा देना/क्षतिपूरण करना) by the Centre for shortfall of state-level revenue, from the proceeds of sin cesses. States agreeing(सहमत होना/अनुकूल होना ) to run pilots to refund the tax paid through a cashback offer — up to 20% of the taxes with a cap of Rs. 100 — to those using RuPay cards or the BHIM app is fine. However, a better way is to facilitate cashless transactions is by cutting the charges that banks impose on customers and merchants( व्यापारियों) for transactions. Competition would lower the cost and the RBI’s savings on handling cash and the Centre’s gains from greater transparency(पारदर्शिता) can fund what remains(बाकी है,/अवशेष), at least in part.

 

 

Important vocabulary

 

1.Hasty(जल्दबाजी /आतुर) ,
Synonyms: abrupt, careless, expeditious, hurried, ill-advised
Antonyms: careful, cautious, kind, leisurely, slow

2.Levy(वसूल करना/आरोपित राशि)
Synonyms:burden, duty, excise, fee, tariff, Antonyms:

3.Trend(झुकाव/प्रवृत्ति)
Synonyms: direction, movement, tendency, aim, bearing

4.Compensated(मुआवज़ा देना/क्षतिपूरण करना)
Synonyms: atone, pay, recoup, refund, reimburse
Antonyms: lose, penalize, take, damage, deprive

5.Converged(परिवर्तित/मिलना
Synonyms: assemble, concentrate, mingle, coincide, combine
Antonyms: disperse, scatter, avoid, differ, disagree

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