Goods and Services Tax (GST) indeed was a very good theme for a convenient corruption-free regime. But instead of being good and simple as publicised by central government, faulty provisions and wrong implementation has made an adverse reaction resulting in cheating, corruption and black money.
Provision of taking back credit of GST under exorbitant GST-rates has resulted in sale of GST-bills (without goods) for purpose of taking back credit making everyone involved in the corrupt practice feel real happy days. Genuine customers actually buying goods are happy because they do not have to pay GST on purchases made without invoice. Shopkeepers are happy because they find opportunity to sell GST-invoices saved by them without giving invoice to actual buyers. Those purchasing GST-invoices without making actual purchase are happy because they claim back GST levied in GST-invoices purchased by them without actually making purchases. Best is to make GST-rates rational and minimal at say 0, 10, 20, 50 and multiples of 100 (without cess) on net paid sale-price rather than levying extra on sale-price. Presently many retailers cheat consumers by charging GST extra on Maximum-Retail-Price (MRP). Provision of claiming GST already paid in purchase-invoices then can be withdrawn by providing only net payable price on invoices rather than printing GST separately on invoices. Suggested increase in minimum tax-slab from 5 to 10 per cent on limited commodities will pave way for heavy decrease in tax-slabs of 12, 18 and 28 per cent to 10 and 20 per cent on majority commodities.
Subhash Chandra Agrawal
(The views expressed by the author in the article are his/her own.)
