{"id":321050,"date":"2024-12-24T20:40:42","date_gmt":"2024-12-24T15:10:42","guid":{"rendered":"https:\/\/forumias.com\/blog\/?p=321050"},"modified":"2024-12-26T11:26:12","modified_gmt":"2024-12-26T05:56:12","slug":"gst-council-delays-reforms-and-rate-rationalization","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/gst-council-delays-reforms-and-rate-rationalization\/","title":{"rendered":"GST Council delays reforms and rate rationalization"},"content":{"rendered":"<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\" wp-image-321132 aligncenter\" src=\"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/12\/GST-Council-delays-reforms-and-rate-rationalization.png?resize=750%2C500&#038;ssl=1\" alt=\"GST Council delays reforms and rate rationalization\" width=\"750\" height=\"500\" srcset=\"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/12\/GST-Council-delays-reforms-and-rate-rationalization.png?resize=300%2C200&amp;ssl=1 300w, https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/12\/GST-Council-delays-reforms-and-rate-rationalization.png?resize=1024%2C682&amp;ssl=1 1024w, https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/12\/GST-Council-delays-reforms-and-rate-rationalization.png?resize=768%2C512&amp;ssl=1 768w, https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/12\/GST-Council-delays-reforms-and-rate-rationalization.png?w=1280&amp;ssl=1 1280w\" sizes=\"auto, (max-width: 750px) 100vw, 750px\" \/><\/p>\n<p><strong>Source<\/strong>: The post GST Council delays reforms and rate rationalization has been created, based on the article \u201c<strong>Express view on PM\u2019s Kuwait visit: Delhi must deliver on West Asia promise<\/strong>\u201d published in \u201c<strong>Indian Express<\/strong>\u201d on 24th December 2024<\/p>\n<p><strong>UPSC Syllabus Topic:<\/strong> GS Paper3-Indian Economy- resource mobilization (taxation)<\/p>\n<p><strong>Context<\/strong>: The article discusses GST Council&#8217;s delay in decisions on tax reductions for insurance and food delivery, extensions for rate rationalization and compensation cess, odd GST rate structures on goods like popcorn, and India&#8217;s complex multiple-rate GST system needing reform. <strong>GST Council delays reforms and rate rationalization.<\/strong><\/p>\n<p>For detailed information on <strong>7 Years of GST<\/strong> <a href=\"https:\/\/forumias.com\/blog\/7-years-of-gst\/#:~:text=GST%20has%20proven%20to%20be,businesses%2C%20has%20shown%20significant%20benefits.\">read this article here<\/a><\/p>\n<h2><strong>What decisions were deferred by the GST Council?<\/strong><\/h2>\n<ol>\n<li>The GST Council, in its 55th meeting, postponed decisions on critical matters:<\/li>\n<\/ol>\n<ul>\n<li><strong>Lowering GST rates<\/strong> for health and life insurance.<\/li>\n<li><strong>Reducing taxes<\/strong> on food delivery charges by aggregators.<\/li>\n<\/ul>\n<ol start=\"2\">\n<li>The <strong>Group of Ministers (GoM)<\/strong> on rate rationalization and compensation cess was also given more time to submit reports.<\/li>\n<\/ol>\n<h2><strong>What are the challenges of India\u2019s GST rate structure?<\/strong><\/h2>\n<ol>\n<li><strong>Multiple tax slabs<\/strong>: India has four or more GST slabs, unlike 49 countries with a single rate and 28 with two rates (World Bank 2018).<\/li>\n<li><strong>Complex classifications<\/strong>: For example, popcorn is taxed differently: salted (5%), pre-packaged (12%), and sugar-mixed (18%).<\/li>\n<li><strong>Confusing item distinctions<\/strong>: Cream buns and regular buns are taxed at different rates, as are frozen parathas and rotis.<\/li>\n<li><strong>Increased compliance burden<\/strong>: Businesses face difficulties adhering to varied rates.<\/li>\n<li><strong>Discretionary power<\/strong>: Bureaucrats have excessive authority due to the system&#8217;s complexity.<\/li>\n<li><strong>Ease of doing business<\/strong>: The system hampers India&#8217;s business environment.<\/li>\n<\/ol>\n<h2><strong>What was discussed regarding GST rationalization?<\/strong><\/h2>\n<ol>\n<li>In its 45th meeting, the council discussed the need to rationalize GST rates, potentially by reducing the number of tax slabs and addressing the classification of items.<\/li>\n<li>The council also extended the levy of the compensation cess until March 2026 to repay loans taken during the pandemic.<\/li>\n<\/ol>\n<p><strong>Question for practice:<\/strong><\/p>\n<p>Discuss the challenges of India&#8217;s GST rate structure and the GST Council&#8217;s efforts toward rationalization.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Source: The post GST Council delays reforms and rate rationalization has been created, based on the article \u201cExpress view on PM\u2019s Kuwait visit: Delhi must deliver on West Asia promise\u201d published in \u201cIndian Express\u201d on 24th December 2024 UPSC Syllabus Topic: GS Paper3-Indian Economy- resource mobilization (taxation) Context: The article discusses GST Council&#8217;s delay in&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/gst-council-delays-reforms-and-rate-rationalization\/\">Continue reading <span class=\"screen-reader-text\">GST Council delays reforms and rate rationalization<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":321132,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,167],"tags":[216,8184,10500],"class_list":["post-321050","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-9-pm-daily-articles","category-economy-subject","tag-gs-paper-3","tag-indian-economy","tag-indian-express","entry"],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/12\/GST-Council-delays-reforms-and-rate-rationalization.png?fit=1280%2C853&ssl=1","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/321050","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=321050"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/321050\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media\/321132"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=321050"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=321050"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=321050"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}