In a series of tweets, on the first death anniversary of former Finance Minister Arun Jaitley, the ministry said before goods and services
GST), the combination of value-added
tax (VAT), excise, sales
tax and their cascading effect resulted in high standard rate of
tax up to 31 per cent.
“It is now widely acknowledged that
GST is both consumer and
taxpayer-friendly. While the high
rates of the pre-
GST era acted as a disincentive to paying
tax, the lower
GST helped to increase
tax compliance,” the ministry said.
The number of assessees covered by the
GST at the time of its inception were about 65 lakh. Now the assessee
base exceeds 1.24 crore.
GST, which subsumed about 17 local levies, was rolled out on July 1, 2017. Jaitley held the finance portfolio in the first term of the Modi government since 2014.
“As we remember Arun Jaitley today, let us acknowledge the key role he played in the implementation of
GST, which will go down in history as one of the most fundamental landmark reforms in Indian taxation,” the Ministry tweeted.
The multiple markets across India, with each state charging a different rate of
tax, led to huge inefficiencies and costs of compliance.
reduced the rate at which people have to pay
tax. The revenue neutral rate as per the RNR (Revenue Neutral Rate) Committee was 15.3 per cent. Compared to this, the weighted
GST rate at present, according to the RBI, is only 11.6 per cent,” the ministry said.
Businesses with an annual turnover of up to Rs 40 lakh are
GST exempt. Initially, this limit was Rs 20 lakh. Additionally, those with a turnover up to Rs 1.5 crore can opt for the Composition Scheme and pay only 1 per cent
GST was implemented, the
tax rate on a large number of items was brought down. As of now, the 28 per cent rate is almost solely restricted to sin and luxury items. Out of a total of about 230 items in the 28 per cent slab, about 200 items have been shifted to lower slabs,” the ministry said.
Also, the housing sector has been placed in the 5 per cent slab, while
GST on affordable housing has been
reduced to 1 per cent.
“All processes in
GST have been fully automated. Till now 50 crore returns have been filed online and 131 crore e-way bill generated,” the Ministry added.