GST: The purpose is to increase revenue collection, the center can change to GST

 National Desk:

 The deadline for states to pay GST compensation is June.  It has already been demanded to increase it further.  In this situation, the GST Council can change the indirect tax rate.  The purpose is to kill two birds with one stone.  On the one hand, raising money for infrastructure by increasing revenue collection.  On the other hand, reducing the dependence of states on GST compensation.  According to the source, in that case the tax rate of 5 percent will be raised and 6% tax may be imposed on some products.  And some products may be shipped at 3 percent.
  The 5 per cent level includes various items such as edible oils, spices, tea, coffee, sugar, sweets, life-saving medicines, coal and packaged goods.  If they are sent to 6 percent, then the price of goods is likely to rise further.  At the same time, the common man was exhausted due to the skyrocketing prices of various essential commodities including petrol and diesel.  The cost of medicines and travel has also increased.  After that, if the prices of more products go up, their confidence will rise.  If the product at 5 percent goes to 3 percent, the plan to increase revenue collection will be pushed.  On the contrary, if the tax collection is reduced then the budget calculation will be confused.
 GST currently has tax levels of 5, 12, 18 and 26 percent.  Some products are under discount.  Cess on some products again sits above 27 percent.  From there compensation is paid to the states.  The tax rate on gold, silver and gold jewelery is 3%.  According to the concerned sources, in order to increase the collection by keeping the budget amount correct, some of the products which are under discount except food items may be brought to the level of 3 percent.  And most products at 5 percent may be shipped at 7, 8 or 9 percent.
 This is being discussed.  A rate will be chosen.  A final decision could be made at a council meeting next month.  However, the indication is that only 6 percent will be chosen.
 According to estimates, a 1% increase in GST on products at the level of 5 per cent would bring in an additional Rs 50,000 crore a year in revenue to the Center.  According to the concerned quarters, the rate of GST on some items like readymade garments and bricks has changed from January to April after the new financial year.  On the other hand, Finance Minister Nirmala Sitharaman has made budget figures by looking at the infrastructure of the country like a bird's eye view.  So huge amount of money is required for investment.  Although there was a plan to raise Rs 1.75 lakh crore in the disinvestment sector in the last financial year, it could not be reached.  The target for the current financial year is much less.  In this situation, the Modi government has no choice but to increase GST.
 On top of that, when the GST system was introduced in July 2016, it was said that the Center would compensate the states till June 2022.  Their revenue collection has declined in the last few years, first due to the slowdown in the economy and then due to the corona, lockdown and pushing of financial activities.  In addition, there are allegations against the Modi government for not paying compensation on time.  Now various states want the compensation period to be extended further.  But the Center does not agree.  In this case, the only way is to increase the tax collection.  The level of GST may be changed for that purpose.  In that case, the question arises, then the general public will have to count the toll in the end standing in the face of high prices?