Sitharaman said GST reforms will aid sectors hit by U.S. tariffs.
GST Council approved two-slab system with 40% demerit rate.
FM confirmed oil imports, including Russian oil, will continue strategically.
She defended India’s economy against Trump’s “dead economy” remark strongly.
Union Minister of Finance Nirmala Sitharaman said on Friday that with the newly approved GST reforms many concerns due to the the 50% tariff imposed by the U.S. administration, would be offset.
In a conversation with Network18 Group, the Finance Minister said this was the first time that the Centre has taken up both the issue of Compensation Cess and a comprehensive proposal on GST.
Additionally, highlighting one of the most talked about issues on the country’s oil imports, Sitharaman stated, “Whether its Russian oil or anything else, it is within our interest, we will have to take a call which decision suits us the best. So we will keep buying.”
The Goods and Services Tax (GST) reforms came just a day ago when the GST Council, in its 56th meeting approved a sweeping set of next-generation reforms for the eight-year-old indirect tax regime. After more than 10 hours of discussion, the Council finalised a broad two-slab structure of 5% and 18%, with an additional 40% demerit rate, specifically for super luxury, sin, and demerit goods.
The changes, which will be effective from September 22, comes as a gift for consumers ahead of the festive season.
During the interview, FM Sitharaman said that Prime Minister Narendra Modi had called her eight months ago to discuss about reforms required in GST. She further highlighted them as “the simplified way of doing business for small businesses and respecting the middle class, taxpayers and every Indian citizen in some way or the other.”
While talking about how the focus of GST 2.0 was to review commodities consumed by farmers and the middle class, the Finance Minister said, "Every item which comes under GST, goods or services, had to be looked at, and to regroup as daily use items used by citizens, and then see those which are going to hit the farmers, the middle class people and so on.”
She also pointed out on the impact of the reforms on the capex of the government. “I can say with confidence that capex of government will not come down, it will be completed as per the Budget estimated timeline. And so will the fiscal deficit, this is the last, this is the last point of my gliding path, I will adhere to it,” she said.
State governments are also moving on reforming, panchayats and ULBs is where the next forceful action has to happen, the FM added.
In addition to that she noted that petroleum and alcohol will stay out of GST in the immediate future.
Talking about Trump’s jibe at India and calling it a ‘dead economy’ among many other things, the Finance Minister gave a befitting response saying, “India requires its citizens to be respected, they are toiling to build their economy. At this time, do we need naysayers to borrow such observations of India being a dead economy.”
Besides the GST reforms and the White House impositions, she also addressed the online gaming ban and said that the government’s decision to curb online real money gaming was necessary as the practice was “ruining our country and our youth.”
