New Delhi: Finance minister Arun Jaitley on said he is hopeful of rolling out the biggest tax reform Goods and Services Tax (GST) from 1 July which will make goods and services cheaper and tax evasion difficult. The finance minister also said achieving a growth rate of 7-8% is plausible and if economies pick up globally then the country’s growth rate can go up further.
Demonetisation, Jaitley said, will act as a disincentive towards continuing to deal with shadow economy, and integration of informal with formal economy will increase the size of the GDP and make it cleaner.
“The biggest taxation reform what we are trying to implement from July 1 is Goods and Services Tax … It will increase the volume of taxation, there is no tax on tax and therefore makes goods, commodities and services little cheaper and far more convenient,” Jaitley said at the 23rd Commonwealth Auditors General conference.
He said the tax department is trying to make the I-T (income tax) backbone so strong so that evasion becomes difficult and hence only limited number of cases are taken up for scrutiny.
“The laws which enable this (GST) are now before Parliament which hopefully should get cleared and once they do get cleared then by the middle of this year we hope to see the implementation as far as this law is concerned,” Jaitley said.
Once implemented what is currently the most complicated tax system in the world will become one of the simplest tax system in the world, Jaitley said.
The Union cabinet this week cleared four supplementary GST legislations which will be introduced in Parliament in the ongoing budget session.
As regards growth, Jaitley said India would continue to remain amongst the fastest growing economies of the world.
“For the last three years we have been the fastest growing major economy, we will continue to be in that phase. I think for India to achieve the growth rate of 7-8% is reasonably logically plausible. If big growth returns to the world we probably can push upwards,” said Jaitley.