Tax celebration' at midnight

Reminiscent of India’s tryst with destiny, as Jawaharlal Nehru, our first PM, called India’s independence on the midnight of August 15, 1947, ushering in of the Goods and Services Tax on the June 30-July 1 midnight seems historic: the most revolutionary reform since then. Union finance minister Arun Jaitley was right to say it will be a celebration at midnight. Hailed as “one country, one tax”, GST is now a bit of a misnomer. There are four tax slabs and several sub-taxes, with, say, different tax rates on a shoe, depending on its price. Perhaps that should be expected in a nation with such a diversity of incomes, unlike in Europe, where there’s no such gaping disparity in the standard of living. It’s only fair that luxuries and high-end items should cost more and essential goods, specially mass consumption items, should be taxed less or not at all, as with foodgrain.

This is exactly what GST has done, and the GST Council must be commended for its socialistic spirit. The only drawback to such varied slabs is that it leaves room for corruption. The very idea of GST subsuming all local taxes was to simplify the tax system and minimise chances of corruption. The GST has also widened the tax net hugely, bringing in millions of traders and mom-and-pop stores which rarely give bills and mostly never paid taxes all these years. The GST Council has taken sensibly allowed room for some flexibility in implementation. While the July 1 implementation date is sacrosanct, businessmen and others have been given time till August-September to comply with all the requirements.