New Delhi, Sept 21: The Congress on Sunday accused Prime Minister Narendra Modi of taking “sole ownership” of the amendments made to the GST regime and said the current reforms were inadequate, with no resolution to the states’ demand for an extension of compensation for another five years.
The opposition party slammed the reforms as “applying band-aid after inflicting deep wounds” and said the government should apologise to the public for its GST on essential items.
A day before reduced GST rates come into effect, Modi made a strong pitch for promoting ‘swadeshi’ goods and asserted that the next generation GST reforms would accelerate India’s growth story, increase ease of doing business, and attract more investors.
In his address to the nation, Modi said a ‘GST bachat utsav (savings festival)’ will begin from the first day of Navratri, and coupled with the income tax exemption, it will be a “double bonanza” for most people.
Reacting to his address, Congress president Mallikarjun Kharge took a swipe at the PM with a Hindi proverb, ‘nau sau choohe khakar, billi haj ko chali’.
“Narendra Modi ji, instead of the simple and efficient GST of the Congress party, your government imposed the ‘Gabbar Singh Tax’ by collecting 9 different slabs and collected over Rs 55 lakh crore in eight years. Now you are talking about a Rs 2.5 lakh crore ‘savings festival’ and applying a simple band-aid after inflicting deep wounds on the public!” Kharge said in a post in Hindi on X.
“The public will never forget that you collected GST on their pulses, rice, grains, pencils, books, medical treatment, farmers’ tractors – everything. Your government should apologize to the public!” he said.
Congress general secretary, in-charge, communications, Jairam Ramesh, said Modi addressed the nation to “claim sole ownership of the amendments made to the GST regime by the GST Council, a constitutional body.”
The Indian National Congress has long argued that the Goods and Services Tax has been a “Growth Suppressing Tax”, he said.
“It is plagued with a high number of tax brackets, punitive tax rates for items of mass consumption, large-scale evasion and misclassification, costly compliance burdens, and an inverted duty structure (lower tax on output as compared to inputs),” Ramesh said in a post on X.
“We have been demanding a GST 2.0 since July 2017 itself. This was a key pledge made in our Nyay Patra for the 2024 Lok Sabha Elections,” he said.
Ramesh said the current GST reforms were inadequate, with outstanding issues, including the widespread concerns of MSMEs, who are the major employment generators in the economy.
“Apart from major procedural changes, this involves further increasing the thresholds that apply to interstate supplies,” he said.
Ramesh claimed that there were also sectoral issues, for instance, in textiles, tourism, exporters, handicrafts and agricultural inputs that must be tackled.
States should be incentivised to move towards the introduction of state-level GST to cover electricity, alcohol, petroleum, and real estate as well, the Congress leader said.
“The key demand of the states made in the true spirit of cooperative federalism, namely, the extension of compensation for another five years to fully protect their revenues, remains unaddressed,” Ramesh said.
He wondered whether the GST changes, “delayed by eight years”, would actually boost the private investment essential for higher GDP growth.
Meanwhile, the trade deficit with China has doubled in the last five years to cross USD 100 billion, Ramesh pointed out.
He claimed that Indian business was crippled by fear and “oligopolisation”, which is leading many to resettle abroad. (PTI)
