GST rate cuts will lower India's tax collection by Rs 150 billion a year

The estimated loss in revenues comes at a time when India needs to keep its budget deficit in check as Modi prepares to ramp up spending on welfare programs

India’s move to slash levies on more than 50 goods will lower revenue by as much as Rs 150 billion ($2.2 billion) each year and is raising the prospect of the country missing budget goals again this year.

A panel of federal and state finance ministers late on Saturday cut the goods and services tax on items from washing machines and lithium iron batteries to stone-carved deities and sanitary napkins as Prime Minister Narendra Modi looks to boost sentiment and growth before he faces re-election next year. The revenue loss will be minimal, India’s interim Finance Minister Piyush Goyal told reporters