A new GST: The indirect tax system simplified for greater efficiency

The removal of the 12 and 28 per cent slabs and the shifting of items from these slabs to 5 and 18 per cent will make a large number of consumer items cheaper

The Goods and Services Tax (GST) Council’s 56th meeting on Wednesday introduced substantial changes to the indirect tax structure. The changes are expected to benefit consumers, reduce classification disputes, and enhance compliance. GST has been shifted to a comparatively simple and principally two-rate structure of 5 and 18 per cent. A special demerit rate of 40 per cent has been kept for select goods and services. Although it can be argued that GST is still not close to the ideal single-rate tax structure, the latest changes will address a number of anomalies and structural weaknesses in the system. It has