GST Structure might become Simpler

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GST Structure might become Simpler
GST Structure might become Simpler

GST or Goods and Services Tax, that came into being on 1st July 2017 is an indirect tax. As the very name suggests GST is not directly paid by the taxpayer to the Government of India. Goods and Services Tax or GST came into being to save underprivileged people from pay heavy taxes to the Government.

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Recently, International Monetary Fund or IMF has advised India to simplify the GST Structure, in a way that will not hurt the underprivileged mass of the country. As the Principle of Progressivity goes, those who belong to higher strata of the society are supposed to pay more taxes as compared to those who belong to the lower strata. This structure helps in maintaining the balance, as those who earn more pay more taxes and the people who earn less pay less taxes.

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Though, when GST came into being, it came as a ray of hope for the citizens of this country, but this new tax could not make much of a difference and has constantly being criticised by the people across the length and breadth of the country.

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When you look at the present GST structure, you will notice that Milk and Luxury cars are taxed at the same rate, apart from this you will also notice that Luxury Watches and Bathroom Slippers are taxed at the same rate, things to meet the basic needs like, sanitary napkins are taxed at a sky-high rate.

The logic behind this rate structure is that, having a single GST rate or even dual rates will push up prices for the lower income groups, and will lower prices for higher income groups. But IMF is quite sceptical about this logic and wants the Government to look into the rate structure of GST and bring in the necessary changes, that will not burn holes in the pocket of the underprivileged section of the Society.

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