New Delhi: Government is trying to keep proposed GST rate "as reasonable as possible" to ensure success of the new indirect tax regime and better growth of the economy, a top Finance Ministry official said on August 20.
"Effort of government is to make tax rate reasonable, as reasonable as possible. High tax rate do not achieve the objective of GST," Revenue Secretary Shaktikanta Das said at an Assocham event here. He also said that the effort of the government is to ensure a tax-payer friendly administration and the black money law will not be misused.
"We need a law which is stringent so that it acts as a deterrent. You cannot have soft laws to deal with blackmoney. We have taken adequate safeguards so that there is no arbitrary exercise," Das said.
"Blackmoney law is a stringent law and its implementation is benign and does not result in arbitrary exercise of power," he said, adding that the government will soon come out with another set of FAQs (frequently asked questions). The government has notified the black money law from July 1.
As per the 90-day compliance window under the Act, those holding undisclosed foreign assets can declare and come clean by paying 60 per cent tax and penalty. The disclosure window closes on September 30 and the tax and penalty has to be paid by December 31.
On GST, Das further said a panel under Chief Economic Advisor as well as another one under the empowered committee of state finance ministers are studying what should be the GST rate. "Government is very much aware that a reasonable GST rate is necessary for successful GST. It should be good for business, economy as a whole," Das said.
He said the one per cent additional tax for inter state supply of goods is intended to bring all states all board to implement GST. "It was a very daunting task but the government has moved forward to implement GST. Once implemented, all states will have revenue buoyancy," Das said.
Internationally, the GST rate ranges between 16-20 per cent however there are exceptions like Japan, Australia and Germany where the rates are 8 per cent, 10 per cent and 23 per cent respectively.
