GST completes seven years, Finance Ministry said- every household has got relief

The Goods and Services Tax (GST) has completed seven years of implementation in the country. This information was given by the Finance Ministry on Monday. The Finance Ministry said that seven years have been completed since the implementation of GST. It has brought happiness and relief to every household by reducing taxes on household appliances and mobile phones.

It is worth mentioning that GST comprised of about 17 local taxes and cess. It was implemented on 1st July 2017 by the current central government led by Narendra Modi. The theme of the 7th GST Day is Empowered Business Holistic Development.

“GST implementation,” the ministry said in a post on X. With the reduction in tax rates on household goods after 2017, #7yearsofGST has brought joy and relief to every household through lower GST on home appliances and mobile phones.” The GST taxpayer base is set to grow from 1.05 crore in April 2018 to 1.46 crore in April 2024. “We have seen a massive increase in the number of taxpayers and compliance has also improved,” said Sanjay Kumar Agarwal, chairman, Central Board of Indirect Taxes and Customs (CBIC).

Giving a comparative chart of pre-GST and post-GST tax rates on household items, the ministry said that the implementation of GST has made living easier and every family has saved money on food items and other common consumer goods. Food items like unpackaged wheat, rice, curd and lassi were taxed at the rate of 2.5-4 per cent before the implementation of GST, but after the implementation of GST, this rate has become zero.

Household items such as cosmetics, wrist watches, sanitary plastic utensils, doors and windows, furniture and mattresses are taxed at a lower rate of 18 per cent in the GST regime, down from 28 per cent in the erstwhile excise and VAT regime. Mobile phones, televisions up to 32 inches, refrigerators, washing machines, electrical appliances (other than air conditioners), geysers and fans, which were taxed at 31.3 per cent before GST, are now in the 18 per cent tax slab in the GST regime, the ministry said.

It further said that the compliance burden for small taxpayers has been reduced, and the GST Council has recommended waiving the requirement of filing annual return for taxpayers with aggregate annual turnover of up to Rs 2 crore in FY 2023-24. The quarterly return filing and monthly payment of taxes (QRMP) scheme has reduced the number of returns filed in a year from 24 to 8, for over 44 lakh small taxpayers, IFF (invoice submission facility) has ensured seamless pass-through of ITC (input tax credit), the ministry said.

Creating fake ITC is still a challenge

GST has simplified compliance, improved tax-efficiency and increased state revenues, but fake invoices and fraudulent registrations remain a major challenge for policymakers trying to curb tax evasion. In 2023, the Directorate of GST Intelligence (DGGI) detected tax evasion of over Rs 1.98 lakh crore and arrested 140 masterminds involved in defrauding the exchequer.

Significant GST evasion was detected in sectors as diverse as online gaming, casinos, insurance and secondment (import of manpower services). The establishment of the GST Appellate Tribunal is expected to simplify and speed up the dispute resolution process for the industry. However, the principal bench and state benches of the GSTAT are yet to become operational. “Our efforts in capacity building, including training over 6,800 officials of various government departments, have been instrumental in promoting an efficient and transparent indirect tax regime,” said Ranjit Kumar Agarwal, president, Institute of Chartered Accountants of India (ICAI).

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