GST benefits extended to people, Rs 20 lakh crore consumption boost likely: Centre
The government on Saturday said that the benefits of recent GST cuts, which came into force from September 22, have been extended to consumers in the festive season, as consumption is one of the key engines for growth.
Addressing the media here, Finance Minister Nirmala Sitharaman, Commerce Minister Piyush Goyal and Railways and Electronics and IT Minister, Ashwini Vaishnaw, said recent GST reforms have brought about a positive trend in terms of consumption.
“Tax reductions have not only happened for the festive season. These reductions mean more collections, so better fiscal room to give something back. Demand will sustain even after the festive season,” said FM Sitharaman.
She said that the GST dispute resolution mechanism has taken off very well.
Since the implementation of the GST reforms, the National Consumer Helpline logged 3,981 calls concerning GST issues (as of October 2). Of those, 31 per cent were queries and 69 per cent were formal grievances handled for further action.
Out of the total, 1,992 grievances have been forwarded to the Central Board of Indirect Taxes and Customs (CBIC) for further action, while 761 grievances have been referred in real time to the relevant convergence partner companies for direct resolution.
According to Sitharaman, the majority of complaints are related to a gap between the understanding of the GST cuts and what has actually been rolled out.
On GST cuts and their benefits, the Finance Minister said that drugs and medicines and related equipment are being monitored to ensure GST cuts are being passed on.
The automobile sector has been very encouraging about GST cuts being passed on to consumers, which has led to an increase in sales.
Goyal informed that almost all e-commerce companies have passed GST cuts and also “gave Navratri offers over and above that as per what we have monitored”.
“Indirect tax directly impacts 140 crore Indians, and now a benefit of Rs 2.5 lakh crore has been given via GST cuts. The multiplier effect due to tax cuts has already given a boost to the economy,” the Commerce Minister mentioned.
Vaishnaw said that during the GST reforms, many estimates were made about how consumption would increase and how demand would grow in the country.
“Because of the GST reforms, it's very likely that consumption will increase more than 10 per cent this year, which means there is a strong possibility of extra consumption of around Rs 20 lakh crore," he added.
