Finance Minister Sitharaman dismisses concerns about GST increase; Highlights Reduction in Rate

Finance Minister Nirmala Sitharaman dismissed concerns about rising GST rates, stating that no single item has seen an increase since the regime’s implementation.

During a question hour in the Rajya Sabha on Tuesday, she highlighted that GST rates have been reduced, bringing the average rate down from 15.8% to 11.3%.

“That is the level of rate of reduction in the GST Council. Hence, I appeal to all the members here, kindly spare some time, meet your respective finance ministers in the states as to what kind of work is going,” she stated.

FM Sitharaman highlighted that GST Council decisions are made collectively, with state finance ministers planning every aspect to simplify the system of taxes. She praised the council members’ diligent efforts in identifying places where tax cuts may be implemented.

“If the GST Council has taken longer to decide on certain matters, it is because thorough work is being done,” she added, noting that state finance ministers have complete authority to interact with their people on council-related issues.

Sitharaman emphasised that the GST Council is a constitutional body and denied claims that tax rates have increased following GST implementation.

“I’d like to take this occasion to dispel the myth that since the introduction of GST, rates have increased. “Not at all,” she stated.

She also challenged anyone to provide an example of how the Union government impeded tax cuts, saying, “Is there an instance? One such instance.”

In a written response to the House, Sitharaman argued that, under Article 279A (4) of the Constitution, the GST Council recommends tax rates, including floor rates, to both the Union and State governments.

She explained that the final GST rate notification is based on these recommendations, which include representation from both the central and state governments.