The Centre today made it clear that it was looking for a lower goods and services tax (GST) rate, though with an expanded base, limited exemption and a uniform rate for goods and services.
In a first formal statement on the nature of the new indirect tax regime, Finance Minister Pranab Mukherjee spelt out the four broad principles of GST. He also hinted that the excise rate of 10 per cent would be the basis for calculating the central GST rate when the new regime takes off on April 1, 2011.
“We wanted to convey a message to the states (through the tax rate),” said the minister his reply to the General Budget debate in the Lok Sabha. He said the government would reduce the areas of divergence among 28 states so that necessary amendment for introduction of GST could take place.
