By TIOL News Service

NEW DELHI, JULY 01, 2017: YESTERDAY midnight made a history with the President of India, Mr Pranab Mukherjee and the Prime Minister, Mr Narendra Modi, jointly launched a new indirect tax regime for India - the GST. In his speech the President hailed the final launch of the new regime but called for constant review of the GST DESIGN by the GST Council.

In his speech the Prime Minister, in his inimitable style, coined a new term for the GST - Good & Simple Tax. While talking about the reform initiative he did not lay his hands on 100% Credit and made it CENVATABLE by passing on the credit to the previous UPA Govt as well apart from the NDA-1 Govt. He also made reference to various historical personalities like Chanakya and Hindu magnum opus like Vedas to talk about economic liberalisation of India. He hoped that with the GST coming into force India would become One Market, One Tax nation. While talking about the benefits of the new system the PM hoped that the benefits of lower tax rates and input tax credit would be passed on to consumers and in particular the poor of the country.

In his address, the Union Finance Minister, Mr Arun Jaitley, hailed the reform in the background of continuing slowdown in the global economy and the new culture of isolationism being practised by many economies. He gave full credit to 'Cooperative Federalism' for taking all the decisions without resorting to their voting rights.

Prior to the formal launch of the GST from the Central Hall of the Parliament where a new advertisement, designed and content finalised by the PMO, was made public, the GST Council held its 18th meeting without a formal agenda and looked into the concerns of certain industries. And as highlighted by TIOL (See Cob(Web)-560), the Council found merit in the problems of the Fertiliser industry and decided to reduce the tax rate from 12% to 5%. Similarly, the tax rate on tractor parts was reduced from 28% to 18%. Both these industries were victims of inverted duty structure where they were prone to accumulating input tax credit.

(Also See our Edit by Vijay Kumar : GST is here - Enjoy the inevitable)