New Delhi: With less than 48 hours to go for the roll-out of the goods and services tax (GST), minister of state for civil aviation Jayant Sinha on Wednesday allayed fears of any disruption, likening the launch to a big wedding party.
“Just like in Indian weddings we will have a great big party and everyone will live happily ever after…I call GST gantantra ka suvidha tantra (the Republic’s instrument of simplicity),” Sinha said.
He was speaking to Mint in a special series hosted in the run-up to the rollout of GST on 1 July.
“More facilities will be given to the public as the income of the government will increase,” he added. “In the future we will be able to control inflation. This is for the people of India, while the 10 million people from the business community will find it easier to pay tax as their compliance burden will be reduced.”
On West Bengal chief minister Mamata Banerjee’s description of the implementation of the tax reform as “another epic blunder of the Centre,” Sinha responded diplomatically.
“In a democracy dissent is what you would expect; we would expect people to have strong opinions,” he said. “These are welcome as they make our democracy more robust and show us our pitfalls. We respect everybody’s opinions. In many cases these objections are well taken. Even in an Indian wedding no one is ever ready until it happens; similarly we also have to move forward. There will be glitches but the country rallies behind such tasks like they did with demonetization.”
Banerjee, who will skip the midnight launch of GST on Friday, wrote in a Facebook post about her concerns over implementation of GST. Some other opposition parties, including the Congress, have also expressed their reservations over the manner in which the reform is being rolled out.
Sinha claimed the information technology backbone to manage the GST transition was ready.
“Systems are very much in shape. But we are prepared, ready and there to assist people through a phone-in number, war room, online assistance. We are putting out training programmes but there may be some transitional issues, teething trouble,” he said.
“One of the problems earlier was that it was hard to define what was a good and what was a service, thus creating confusion in tax administration. Now we have put all goods and services in one basket in a unified tax administration, with the registration happening at one place,” Sinha added.
Mint had reported last week that the government is set to roll out the GST on 1 July in the central hall of Parliament for which President Pranab Mukherjee, former prime ministers and current finance ministers of 32 states and Union territories have been invited. There is also a meeting of the GST Council which will be held before the official roll-out.
The minister argued that with GST and demonetisation, the Union government is signalling its appetite for big-ticket reforms.
“This government has started some big bang reforms. The largest reform is the formalization of our economy. If we want to become an advanced 21st century economy that can compete with the US, Germany, China and Japan, we have to have an economy that is operating in the formal structure. This move towards formalization which we have undertaken through demonetization as well as GST is profoundly important for our economy,” he said.
Sinha said over time the existing structure of GST could be streamlined. “Democracy is the art of possible. With the rates that we have put in place, 5%, 12%, 18%, 28%, we have managed to meet both those principles, which is revenue neutrality and price stability. Overtime we want to make the GST structure more efficient and streamlined as we go along. We will further streamline the GST rates, may be from the multiple rates that we have right now, to 2 or 3 rates,” he said.