INDIRECT TAXES
| GST rates likely to be pegged at above 12 per cent Thu, 04 Mar 2010 19:53:42 GMT |
| The Economic Times GST rates likely to be pegged at above 12% 5 Mar 2010, 0123 hrs IST, ET Bureau Topics: New Delhi Sunil Mitra 13th Finance Commission Goods and Services Tax revenue secretary finance ministry official NEW DELHI: The government on Thursday said the proposed goods and services tax (GST) rate is likely to be pegged higher than 12% recommended by a task force set up by the 13th Finance Commission. “The task force had recommended an overall GST rate of 12% ...but it is likely to be higher than that”, revenue secretary Sunil Mitra said at a CII function here. The task force had recommended 5% for Central GST and 7% for state GST. As per the Centre’s calculations revenue neutral rate of GST, or the rate at which states will not lose any revenues in the GST regime, works out to 16-17%, said a finance ministry official who did not wish to be identified. States on the other hand have suggested a higher combined GST rate of 16-20%. The GST, set to be rolled out from April 1, 2010, is now scheduled to be launched a year later as the centre and states are yet to come to an agreement on the nitty-gritty of the tax structure owing to persistent differences on crucial elements such as turnover threshold limit. The GST seeks to replace the major indirect taxes — excise duty, service tax, value added tax and other state taxes — with a single levy and will create a national common market that is at present fragmented because of multiple levies. |
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