The Next-Gen GST reforms are a testament to Prime Minister Narendra Modi’s steely resolve to serve the poor, youth, farmers and women, Union Home Minister Amit Shah said on Monday as the new tax structure came into effect across the country.
Shah also said that the new reforms will move the wheel of India’s growth even faster on the path of becoming the most prosperous country in the world.
The BJP , meanwhile, said the reduced cost of items has ignited a “wave of happiness” among people and cited higher tax on same products during the Congress-led Government to slam its criticism of the GST reforms. Shah said , “The #NextGenGSTReforms are a testament to PM Shri Narendra Modi Ji’s steely resolve to serve the poor, youth, farmers, and women,” he said in a series of social media posts in both English and Hindi with the hashtag ‘GSTBachatUtsav’.
The Home Minister said the Modi Government is increasing the income of the middle class by opening plenty of opportunities for them and ensuring that their savings rise constantly through the Next-Gen GST reforms.
He said the steep reduction in the GST rates of daily essentials, healthcare products, electronic appliances, and educational items will boost their disposable income and encourage them to save even more.
The Home Minister said the Next-Gen GST reforms is Modi Government’s gift to all the mothers and sisters of the country on the auspicious occasion of Navratri, which begins on Monday. “PM Modi’s promise to the countrymen regarding GST reform has been implemented across the entire country starting today. In this GST, historic reductions have been made in taxes on more than 390 goods,” he said.
Shah said in areas such as food and household items, home building and materials, automobiles, agriculture, services, toys, sports and handicrafts, education, medical and health, insurance, etc., unprecedented relief in GST will bring joy to the lives of the citizens and also increase their savings.
He said making GST zero on many dairy products, or unprecedented reductions on everyday items like soap, toothbrush, toothpaste, hair oil, shampoo, the Next-Gen GST reforms has brought the gift of happiness to every home. “From zero GST on life insurance, health insurance, senior citizen policy, 33 life-saving drugs and diagnostic kits to minimal GST on oxygen, surgical instruments, medical, dental and veterinary devices, GST reform will bring historic growth in the savings of the countrymen,” he said. Shah said farmers are excited with the GST reduction on agriculture equipment and fertiliser sector, and now citizens will not have to think more for vehicle purchases either.
“This GST reform will also boost self-reliance. You too adopt indigenous products in daily use items,” he said.
Hitting back at the Congress for its “Gabbar Singh Tax” criticism of the GST, Union minister and BJP leader Ashwini Vaishnaw cited the incidence of much higher rates during the UPA Government to throw “Gabbar Singh ke bade dada” (the grandfather of Gabbar Singh) barb. Giving examples, he said the tax rates on cement, sanitary pad, paint, footwear, TV and fridge during the Congress-led UPA rule were 30, 13, 30, 18, 30 and 30 per cent respectively.
The corresponding rates now are 18, 0, 18, 5, 18 and 18 per cent, he told reporters, asserting that the reduced costs have led to a “saving festival” and sparked a wave of happiness. In a swipe at the Opposition, he said its unhappiness with the GST and the current reforms is “natural” because all it did was talk and took no action when it was in power.
Prime Minister Narendra Modi took States into confidence to roll out the unified tax regime in 2017, doing away with a complex web of levies, he added.
Vaishnaw, who had visited the RK Puram market earlier to see the mood among shoppers and traders, said reports from every corner about its impact are good. The business sector has passed on the tax cut benefits to consumers, he said.
The minister, however, added that the Government is keeping a vigil and will take strict action in case consumers are not given the benefits.
Prime Minister Modi interacted with traders and shoppers during his visit to Arunachal Pradesh on Monday and other ruling alliance members followed suit, as the Government is hopeful that the fall in costs of a wide array of items, ranging from everyday use to cars and TVs, will create an upbeat mood and boost economy at a time when the high tariff imposed by the US has impacted Indian export.
Vaishnaw expressed confidence that the consumption boost will raise investment and, consequently, employment. He said the consumption’s share of India’s GDP of nearly Rs 330 lakh crore is Rs 202 lakh crore against Rs 181 lakh crore in the last fiscal. He claimed that the fall in prices will add at least Rs 20 lakh crore to the overall GDP.
Coupled with tax exemption on earnings up to Rs 12 lakh, this decision will bring a significant improvement in the life of the middle class, he said, adding that the fall in the prices of tractors, fertilisers and other products used in farming will help the agriculture sector as well.