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Assam Finance Minister and a member of the GST Council, Himant Biswa Sarma, on Tuesday said deliberation on tax rates relating to handicrafts, handloom and inclusion of real estate would be taken up at the next meeting of the council scheduled for January-end.
According to him, there is scope for further pruning of rates.
He cited the example of theatre and Bollywood movies both coming under the same tax slab of 28 per cent. However, the council will look at simplification of classification of goods under different tax brackets.
“Pruning of rates is a continuous process and I believe that for some time pruning will continue. Overall picture you’ll have to see in terms of revenue (tax) buoyancy. As and when we establish a good revenue growth, scope of pruning is always there. But it is not that all items from the 28 per cent tax bracket will come down,” Sarma said on the sidelines of the inauguration of Emami Ltd’s plant at Pacharia in Kamrup district of Assam.
According to the Minister, at the Guwahati meeting of the council, items such as paints and cement were kept in the 28 per cent tax bracket though these are goods of mass consumption. But, if we reduce the GST on cement by 10 per cent, government will lose ₹10,000 crore by tax collection. However, except paints and cement, GST on all construction inputs has come down and builders should pass the benefit to customers.
Inclusion of real estate On inclusion of real estate, he said, an approach paper was already tabled at the Guwahati meeting. But it could not be taken up for discussion.
Issues such as architecture, surrender of stamp duty, multiplicity of taxes (across states) have to be discussed and resolved before real estate is brought under GST.
“It is a live issue before the council,” Sarma said. “Basically, the idea is to bring real estate under GST. So if it is brought under GST, then there cannot be multiple taxes (stamp duty). Now whether States will be ready to surrender stamp duty or whether stamp duty will be taken as nature of goods, this architecture has to be developed.”
However, Sarma was not hopeful that the issue of inclusion of petrol and diesel would be taken up in the next meeting of GST council.
According to him, the e-way bill system is unlikely to come in before next April. The National Informatics Centre (NIC) has been asked to develop a proper national e-way bill system. But it is yet to come up with the required software.
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