Straight from the Specialists
(The views expressed in this column are the author’s own and do not represent those of Reuters)
India Inc has time and again expressed its desire for early implementation of Goods and Service Tax (GST). While implementing GST may take at least a year, the 2012 budget will clearly indicate the Centre’s seriousness in implementing GST.
– Reduction of Central Sales tax (CST) to 1 pct or 0 pct
– Implementation of negative list based service taxation
– Liberalising Cenvat credit mechanism to avoid any kind of cascading
While all of us keep watching the dithering EGoM of state Finance Ministers to bring in a consensus on carrying out massive tax reforms, what we are witnessing is a clear push back. The recent news that states would want the Centre to increase the central sales tax rate to 4 pct (from the existing 2 pct) clearly indicates the mood.
While everyone is hoping for a calibrated reduction/phasing out of CST, this sudden demand takes us back by a few years on GST implementation.