Pitching for early introduction of goods and services tax (GST), Finance Minister Arun Jaitley on Saturday said the idea of ‘one-nation-one-tax’ was extremely important for India as it would not only reduce the level of taxes but also eliminate corruption. It would also improve ‘ease of doing business’, he added.
“You cannot have an indirect tax regime, where you are taxed at every point and then at the next point, there is tax on the tax already paid,” Jaitley said delivering the first APJ Abdul Kalam memorial lecture in the Capital. This tax-on-tax situation is commonly referred as ‘cascading’ in tax parlance.
Jaitley’s push for GST is significant as it comes at a time when the Rajya Sabha is expected to take up the Constitutional Amendment Bill, which would pave the way for GST introduction, passage and consideration this week.
A Constitutional amendment is a must for GST introduction as the Centre does not currently have a right to tax at the retail stage. Jaitley also underscored the need to have credible and stable taxation system. “Our direct taxes have to be comparable to the best elsewhere in the world....If you are a high taxing society, people will go where you have to pay less taxes,” he said.Credible politics
Jaitley said India needed “credible politics” that will enable it to have “credible policies”.
The Finance Minister emphasised that India cannot afford the kind of spectrum or coal mines controversies of the past.
He noted that Kalam’s vision of becoming a developed country by 2020 doesn’t seem possible now. However, one could look to achieve it by 2030 if the country focuses on education and develops scientific temperament.
“We cannot afford to have Bengaluru and Gurgaon, the IT hubs that are representatives of India globally, in the condition they have been over the past few hours,” he said, referring to waterlogging following heavy rains.Kalam's humility
Recounting the great qualities of late President APJ Abdul Kalam, Jaitley said that this ‘people's president’ was man of great humility.
“In an environment of cynicism, he was one man who represented positivism,” Jaitley said.