oppn parties GST: Why Impose Cess?

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  • Supreme Court sentences Congress leader Navjot Singh Sidhu to one year rigorous imprisonment in the 1988 road rage case
  • Home Minister Amit Shah says rights should not be demanded before fulfilling responsibilities and that universities are no place to wage ideological battles
  • NIA court convicts JKLF chief Yasin Malik in terror funding case after he pleads guilty of all charges
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  • Supreme Court rules that the decisions of the GST Council are not binding on the Centre and the states, leaving the door open for states to levy further taxes
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  • Nikhat Zareen is world champion in flyweight category. Wins gold at Women's World Championships at Instanbul
  • Supreme Court uses its special powers under Article 124 to release A G Perarivalan, a Rajiv Gandhi assassination convict
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  • Hardik Patel quits Congress, says top leaders distracted by mobile phones and state leadership busy arranging 'chicken sandwiches' for them
  • Anil Baijal resigns as Lieutenant Governor of Delhi citing "personal reasons"
Nikhat Zareen is crowned world champion in the flyweight (52Kg) category at the Women's World Championships in Istanbul /////// Supreme Court sentences Navjot Singh Sidhu to rigorous imprisonment of one year in the road rage case /////// Sunil Jakhar, who quit the Congress a few days ago, joins the BJP
oppn parties
GST: Why Impose Cess?

By Sunil Garodia
First publised on 2016-11-04 08:54:00

About the Author

Sunil Garodia Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator.
The GST Council, in its collective wisdom, still thinks that imposing a cess on the highest taxed slab of so-called sin goods is necessary. But it goes against the principle of GST which was envisioned and designed to subsume all cesses. Any compensatory pool could have been created by earmarking a percentage from sin goods for that purpose, while taxing them at a still higher percentage. Once a precedent for imposing cess is put in place, it is likely to be abused on the smallest of pretexts.

The other decisions of keeping daily essentials out of the ambit and taxing other regular necessities at just 5% need to be welcomed. But the government will have to ensure that companies pass on the benefits to the consumer and do not increase prices to realize the stated benefit of less inflationary pressure. It also needs to be ensured that most other products and services come under the 18% slab. Luxury items taxed at 28% should exclude smaller petrol and electric cars.

It is good that a consensus has been reached on the rates. It will ensure an early roll-out. The Council should rethink the cess and exemptions should be kept at a minimum. The focus should now be on the IT backbone, the training of staff and the actual transition. The teething problems can be sorted out once GST is up and rolling.