TMI BlogNOTHING ON GST IN BUDGET - 2016X X X X Extracts X X X X X X X X Extracts X X X X ..... NOTHING ON GST IN BUDGET - 2016 - By: - Dr. Sanjiv Agarwal - Goods and Services Tax - GST - Dated:- 10-3-2016 - - Union Budget for F.Y. 2016-17 is a complete miss so far as Goods and Services Tax is concerned, more so when everyone was expecting some announcement on GST in this Budget. The Budget speech in its opening paragraphs highlights the achievements of last three years including economic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consolidation, growth and other strengths besides counting on the failures of previous Government but it lacks direction, vision, seriousness and commitment towards migrating to GST. It is regretful that with this broader focus in mind, Government has failed to touch upon the way forward for GST in India and thus missing the unique opportunity in the third Budget (out of five) of the present t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erm of this Government. Though the Budget does not provide any assurance on GST or even a road map or way forward for GST to happen, there are certain clues to be drawn from the Budget. However, such clues lead to further confusion and do not add to any clarity, whatsoever. On the positive side, many cesses have been scrapped as a clean-up exercise. 13 cesses which did not yield tax revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of more than ₹ 50 crore have been withdrawn. These include education cess, secondary and higher education cess, salt cess, mica cess, iron cess and cesses on manganese chrome ore, lime stone dolomite, textile, cine workers etc. Many exemptions including area based exemptions have been withdrawn or pruned as a preparatory exercise for GST regime. Textiles, readymade branded garments, edi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble oils, jewellery etc have been subjected to excise duty. Many exemptions in Service Tax have also been withdrawn and negative list pruned. On the fillip side, Budget has introduced new cesses which goes against the very scheme of proposed GST. Infrastructure cess has been levied as excise duty on vehicles w.e.f. 1 st March 2016 (i.e., already levied) for the purpose of building traffic free ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roads and pollution free environment. This cess would be from 1% to 4% on various types of specified vehicles excluding taxies, three wheelers, ambulance, vehicles use by handicapped persons etc. Another cess called Krishi Kalyan Cess (KKC) @ 0.50 percent has been levied an all taxable services w.e.f. 1 st June, 2016 as Service Tax. It will be levied on all services and used to finance and pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omote initiatives to improve agriculture and farm development or any other related purpose. However, KKC shall be subject to cenvat credit. KKC will go to consolidated Fund of India and appropriated by the Parliament. In post Budget interaction with stakeholders, it has been stated by Ministry of Finance team that many procedural changes have been made keeping in mind goods and services tax in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... near future. The changes in rates of Service Tax and excise duty will be possible only when a decision is taken by proposed GST Council which will be setup after Constitutional Amendment Bill is passed which is pending in Rajya Sabha. The draft law on GST in still under preparation and is expected to be put up in public domain before finalization. It is an irony that even after twenty five year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of starting economic reforms in India since 1991, we have not been able to have required tax reforms in place. On one hand we talk of good governance and talk of slogans like 'ek bharat, shreshta bharat' but on the other hand, fail to address the issue of deadlock on GST which is grossly detrimental to the economic interests of the nation. It also reflects weak political will and non-s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eriousness of all political parties. It would be in fitness of things that the Finance Minister comes out with a paper laying down clear cut road map on GST and its strategy to take it to logical conclusion in a time bound manner. Better late than never. There is a school of thought which suggests that if GST is not implemented in 2017, the present Government may not be able to do so in the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t term, leaving the country's economy to suffer and bear the cost of non-performing democratic parliament. - - Scholarly articles for knowledge sharing authors experts professionals Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
