Much fairer system, better for everyone: Tharoor welcomes GST reforms

Congress MP Shashi Tharoor has welcomed the recent GST reforms and termed them a "much-fairer" system, saying that these reforms will provide relief to the common people and will be better for everyone.

Speaking to ANI on Sunday, Tharoor said the Congress party has been demanding changes in the Goods and Services Tax (GST) rate slabs for several years.

"We in the Congress party have been asking for this for many years. I think our leaders have been flagging the need to go from four rates to at least just two, or ideally one, one day, because this is actually unfair to people. When you had four rates, it was confusing, it was difficult. People were not happy about this. So now I think it's a much fairer system and we hope it'll be much better for everyone," the Congress MP said.

Earlier, Congress President Mallikarjun Kharge alleged that US President Donald Trump's "pressure is mounting" and claimed the Union government implemented the GST reforms with elections approaching.

Kharge also criticised Prime Minister Narendra Modi following the US tariffs imposed on Indian exports by the Trump administration.

"They are doing this now when the elections are close, and Trump's pressure is mounting. These people kept saying that China was not allowed to infiltrate into the country, and now PM Modi himself went and met them... If we are supporting them, that doesn't mean they can make arbitrary decisions... We have been practising a non-aligned policy since the time of Jawaharlal Nehru. However, when PM Modi came to power, he made statements like 'Trump is my friend.' Then Trump made statements that ruined the environment in the country and the world. They are not executing our foreign policy properly..." Kharge said.

On September 3, the 56th GST Council meeting decided to rationalise GST rates to two slabs of 5 per cent and 18 per cent by merging the 12 per cent and 28 per cent rates.

The 5 per cent slab comprises essential goods and services, including food and kitchen items such as butter, ghee, cheese, dairy spreads, pre-packaged snacks, bhujia, mixtures, and utensils; agricultural equipment; handicrafts and small-scale industries; as well as medical equipment and diagnostic kits.

The 18 per cent slab applies as a standard rate for most goods and services, including automobiles such as small cars and motorcycles (up to 350cc), consumer goods like electronic items, household goods, and some professional services. A uniform 18 per cent rate also applies to all auto parts.

Additionally, there is a 40 per cent slab for luxury and sin goods, including tobacco and pan Masala, products such as cigarettes, bidis, and aerated sugary beverages, as well as luxury vehicles, high-end motorcycles above 350cc, yachts, and helicopters.

Some essential services and educational items remain fully exempt from GST, including individual health, family floater and life insurance, as well as certain services related to education and healthcare.