In the GST Council, the Union finance ministry has proposed four rates - 6 per cent, 12 per cent, 18 per cent and 26 per cent - and cess. I think that this cess is a disastrous idea. The government has not been able to get rid of a putting cess for development of something or the other. Once one cess is levied, the goods and services tax (GST) will become a 'cess pool' sooner than later.
First an educational cess might be be levied. Then copra and tea cess will follow. There will be no end to it. Rather than cess, the government can increase the rates or adjust all rates so that only these remain. There is an ample scope to combine the two rates - 12 and 18 per cent - so that the extra Rs 50,000 crore the government wants to collect comes from the basic rates themselves . In fact, the rates of 12 and 18 per cent should be combined at 16 per cent, so that only three rates - 6 per cent, 16 per cent and 26 per cent remain. One-time exception of cess is like a one-time extra-marital escapade. It never remains at one.
Sukumar Mukhopadhyay, New Delhi
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