Former Union Finance Minister and senior Congress leader P Chidambaram has welcomed the Center’s decision to rationalize GST rates in two slabs, stating that he appreciates the government for “realizing” his mistake, eight years after its start on 1 July 2017.
He said that several economists, including the Congress party and former Chief Economic Advisor Arvind Subramanian, had expressed concern about the tax structure when it was first implemented.
Speaking to reporters in Madurai, Chidambaram said, “I appreciate the government for realizing my mistake after eight years. Eight years ago, when this law was implemented, it was wrong. At that time we advised that it should not be done. The then Chief Economic Advisor Arvind Subramanian also advised that it was a mistake.”
Thanking the NDA government for realizing its mistakes, Chidambaram targeted Prime Minister Narendra Modi and his ministers to ignore the Congress’ arguments about the deficiencies of GST. GST was implemented in India on 1 July 2017 and replaced the previous indirect taxes under the 101st Constitution Amendment Act, 2016.
The initial integrated tax structure included several slabs including 0%, 5%, 12%, 18%and 28%, which applied on the basis of their imperative and luxury status on various objects and services. The Congress leader said, “But at that time neither the Prime Minister nor the ministers listened to us. We spoke many times in Parliament. Now, I thank them for realizing the mistake and rectifying it. “
Chidambaram said that the middle class and poor people have been “squeezed” due to high tax rates, but they welcomed the reforms and said that this would provide relief to these groups. He said, “The middle class and poor people have been kept squeezed for eight years. The rates of 12% and 18% have been reduced to 5% now. For so many years, the same people have kept the burden of 12% for so many years. I appreciate. “In a statement issued earlier, the Congress leader criticized the Center for” 8 years delay “in bringing these reforms. He said that GST should be” good and simple tax “.
The statement said, “Welcome to rationalizing GST and reduction in rates, but the idea comes to mind that these steps have been taken with a delay of eight years. Congress, many economists and people of medium and poor sections have been saying for years that GST’s design and starting rates were wrong, but the government is unheard that the government is happy that the government has been felt that the government has been misunderstood. And he has always taken a good and simple by taking a good and poor class of the government and other government leaders, the finance minister and other government leaders were to be a good and simple.
In the 56th meeting of the GST Council, it was decided to rationalize the GST rates in two slabs of 5 percent and 18 percent, including 12 percent and 28 percent rates, which would be applicable from September 22, 2025.
5% slabs include essential commodities and services, including food and kitchen items such as butter, ghee, cheese, dairy spreads, pre-pack salty, bhujia, mix and utensils; Agricultural equipment such as drip irrigation system, sprinkler, bio-pesticides, micronutrients, soil-preparing machines, harvesting equipment, tractor and tractor tires; Handicrafts and small scale industries such as sewing machines and their parts and health and welfare include medical equipment and diagnostic kits.
While 18% of slabs include a standard rate for most goods and services, including small cars and motorcycles (up to 350 cc) such as automobiles, electronic items, household items such as consumer goods and some professional services, applies to an equal 18% rate to all auto parts.
In addition, luxury and harmful items including tobacco and paan masala, cigarettes, bidis and aerated sugars, beverages and luxury vehicles, high -capacity motorcycles, boats and helicopters with high capacity of 350 cc, boats and helicopters also have a slab of 40%. Apart from this, some essential services and academic goods have been given a complete discount from GST, in which all the essential services and educational items have been given a complete discount from GST, Floater and life insurance includes, there is no GST on health and life insurance premiums and some services related to education and healthcare are free from GST.