GST Reform: The Ministry of Finance on Friday (August 15) said it has proposed a two-slab GST rate structure to the Group of Ministers (GoM), along with
special rates for select items.
According to a PTI report, soon after Prime MInister Narendra Modi's announcement that Next-Generation GST reforms will be introduced by Diwali this year, the Ministry said Centre's proposal shared with the GoM rests on three pillars -- structural reforms, rate rationalisation and ease of living. The proposal includes reduction of taxes on common man items and aspirational goods.
Currently, GST is a 4-tier structure of 5, 12, 18 and 28 per cent.
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Earlier this morning, PM Modi in his 12th Independence Day speech from the ramparts of Red Fort, announced the introduction of Next-Generation GST reforms by this Diwali, aimed at reducing taxes on daily-use items.
“The government will bring Next Generation GST reforms, which will bring down tax burden on the common man. It will be a Diwali gift for you,” he said, ensuring that these reforms directly benefit citizens and stimulate economic activity.
Next GST Council Meeting
The GST Council is chaired by Finance minister Nirmala Sitharaman and comprising state ministers. The GST Council is expected to meet in September to discuss the GoM proposal on rate rationalisation.
The Finance Ministry said the end of compensation cess has created fiscal space, providing greater flexibility to rationalise and align tax rates within the GST framework for long-term sustainability.
