Finance minister Arun Jaitley in his Budget speech reiterated the government’s commitment to meet the deadline to put in place a countrywide single goods and services tax (GST) by April 1, 2016.
Adding that the country is embarked on two more game changing reforms, Jaitley said: “GST and what the Economic Survey has called the JAM Trinity — Jan Dhan, Aadhaar and Mobile — to implement direct transfer of benefits. GST will put in place a state-of-the-art indirect tax system by April 1, 2016.”
He also said that in his vision of making India’s direct tax regime competitive, the single largest tax reform of the country would bring in greater transparency and improve investment climate.
“I have a vision of putting in place a direct tax regime which is internationally competitive on rates, is without exemptions, incentivises savings, and does not realise tax from intermediaries. Such a direct tax regime would match the modernised indirect taxes regime we are putting in place by way of GST, and will bring both greater transparency and greater investments,” Jaitley said.
He further said that GST would also ensure revival of growth, job creation and play a transformative role for the economy. “We need to revive growth and investment to ensure that more jobs are created for our youth and benefits of development reach millions of our poor.
“GST is expected to play a transformative role in the way our economy functions. It will add buoyancy to our economy by developing a common Indian market and reducing the cascading effect on the cost of goods and services. We are moving in various fronts to implement GST from the next year,” he said.
Welcoming the GST announcement, Sachin Menon, chief operation officer — tax, head of indirect tax, KPMG in India said, “The devolution of 62% of the tax revenue to the states (including state taxes) is giant leap towards empowering states with additional funds to lead local developments. I wish this opportunity could have been leveraged by the Finance Minister to address the states revenue concern...”