A move to rationalise both “processes” and “rates” across some product categories to ease out the “pain points” has been initiated and this could be taken up at the next meeting of the GST Council on October 6, Revenue Secretary Hasmukh Adhia told The Indian Express.While he predicted that a rebound in growth is expected in the wake of the restocking by trade and the impact of the ongoing festival season, Adhia said that transition issues are likely to be sorted out over the next one year or so.“Rationalisation has to be done for sure. The Finance Minister has said that we will wait for revenue trends to emerge but some rationalisation is required and an exercise has been initiated for that. The final decision is to be taken by the GST Council. The Council has done some work on rates already to ease the pain points,” Adhia said in an interview that will be published tomorrow.The Revenue Secretary also indicated that concerns raised by exporters and small scale industries would also be taken up by the GST Council.
On process rationalisation, Adhia indicated that some of this will happen in the October 6 meeting (of the GST Council). On the rationalisation of rates, the issue of eliminating classification disputes and on some items where not much revenue is involved, the rates could be lowered, he added.While the process of clubbing of some of the tax slabs is an issue that has been left for the future, some items can move from one (slab) to the other (slab) and that is also part of the rate rationalisation under consideration
On criticism from several quarters that GST rollout was hurried and the GST Network was not allowed to go through a trial process, Adhia said: “As far as the right planning is concerned, in fact, one has to make a beginning and any time you begin there will be initial problems. It is not that you can always have a system in which hundred per cent safe landing can be done. At any time you start such a (reform), you will learn from experience that what are the pain points. So, no time is a good time, in that sense. If we keep waiting for so long, then we will not be able to do it. But these are initial transition problems.”He said that transition problems and initial hiccups were “expected and those are to be solved by experience only”. “Some of things we couldn’t have visualised at all, so those things we realised only by experience,” he said.
Finance Minister Arun Jaitley had last Sunday reiterated that there was scope for reduction in tax slabs under the Goods and Services Tax (GST), suggesting that once there is revenue buoyancy, the country would have “space for improvement to think in terms of bigger reforms such as lesser slabs”.On Saturday, RSS chief Mohan Bhagwat had asked the government to not allow informal sectors such as small and medium enterprises, self-employing cottage industries, and agriculture to suffer, and called for “sensitivity” and “efficiency” on the part of the administration in reaching benefits to the last man.
Adhia said the government expects the transition issues to be over within a year and real benefits of GST will start in due course. “I hope within a year, transition problems will be over. After one year, we will see the real benefits of GST for everybody, even the vyapaari (trader) will feel it’s very simple. Right now, the fear of unknown is also there plus it’s a new learning experience for the tax practitioners.