GST good for government, bad for people: Congress

The Congress on Saturday termed the Goods and Services Tax (GST) as good for government and bad for people.

Congress' statement is an indirect jibe at Prime Minister Narendra Modi who termed the GST as Good and Simple Tax.

Addressing a press conference here, former union minister and senior Congress leader Kapil Sibal pointed out the 'shortcomings' of the new tax regime that was implemented on July 1 all over country except Jammu and Kashmir, which also passed it on Friday.

"There are many GST tax slabs- 0. 25, 03, 05, 12, 18, and 28 percent. The sad part is that apart from the GST the state governments are required to also levy municipal tax," Sibal said.

 

Giving example of shortcomings in the GST, Sibal said, "If a cinema ticket is less than Rs. 100 then the rate of GST is 18 percent and if more than Rs. 100 then it is 28 percent. In Tamil Nadu, a cinema ticket costing more than Rs. 100 is being taxed with 28 percent GST and 30 percent extra tax."

The Congress leader further added "it means a common man will have to pay 58 percent entertainment tax on a cinema ticket costing more than Rs 100, and 48 percent for cinema ticket less than Rs 100".

"In our country the cinema is the only mode of entertainment for common man. What type of tax is it? On the other hand, the Maharashtra government has decided to levy extra 2 percent on road tax apart from GST in order to cover up its losses," Sibal said.

Pointing out the other loophole in the GST system, the Congress leader said that "there is no GST for loose wheat flour and biscuits whereas the packaged ones are taxed".

He questioned: Who buys loose wheat flour and biscuits these days as everything consumable good is sold in packaged form, which is good also.

The Congress leader wondered what is the motive behind these provision of the GST, which was aimed at making taxation system simple.

He also questioned the 5 percent GST on the clothes merchants "who were never taxed till the new tax regime was launched".

The government says that the GST would benefit all the stakeholders namely industry, government and consumer as it will lower the cost of goods and services give a boost to the economy and make the products and services globally competitive, giving a major boost to 'Make in India' initiative.