INSUBCONTINENT EXCLUSIVE:
Streamlining exemptions would further reduce compliance and administrative costs, the IMF recommended.WASHINGTON: The IMF today described
the Goods and Services Tax (GST) as a "milestone reform" in India's tax policy, but pushed for a simplified structure, saying the multiple
rate structure and other features could give rise to high compliance and administrative costs
In its annual country report, the International Monetary Fund also said that a dual rate structure with a low standard rate and an
supply of goods and services in India
complex structure with a relatively high number of rates (and exemptions), which could be simplified without sacrificing progressivity of
with a low standard rate and an additional higher rate on select items can be progressive and preserve revenue neutrality, while
effective tax rate rising with household consumption.A revenue-neutral reduction in the number of rates would raise the effective rates for
poorer households while reducing those for richer households
step of harmonising indirect tax rates on goods and services that previously differed across different states and the centre, and brought
rates of five per cent, 12 per cent, 18 per cent, and 28 per cent; special low rates of three per cent on gems and jewelry and 0.25 per cent
on rough diamonds; and a GST "cess" levied on demerit goods
tax created a unified national market for the first time by lowering internal barriers to trade - effectively establishing a free trade
the amount of economic activity taking place in the formal sector of the economy - leading to better quality and more reliable jobs, he
room for the government to increase much needed social and infrastructure spending," Salgado added.(Except for the headline, this story has
not been edited by TheIndianSubcontinent staff and is published from a syndicated feed.)
