Original GST system was to have only three rate GST structure, Krishnamurthy Subramanian, the Chief Economic Advisor in finance ministry said on Thursday. The Government is further planning to rationalize the GST structure to the three slab GST structure by merging of the two categories. Subramanian said that the progress on this front would soon be visible.
While saying that the three rate structure is definitely important, he assured that it would definitely happen soon.
Addressing an event organized by Assocham on Thursday, he said that the government is also wary of the inverted duty structure and there is a need to fix it. Government is also mulling to fix the inverted duty structure.
Though the original plan was to have a three-rate structure of GST, Subramanian said, however, it was an excellent move to go ahead with the current GST structure of four slabs because it was then practical enough to get the things going and also for the collections achieved.
Currently, there are four slabs of GST rates which are 5%, 12%, 18% and 28% besides the exempted category. 5% GST rate is for essential needs and have been kept at lowest. The luxury items are charged at highest and are kept in 28% GST basket.
Besides these four primary slabs, special GST rate of 0.25% and 3% are also applicable on precious stones and jewelry are charged at special GST rate
There has been discussion regarding the merging of 12% and 18% GST rate slabs, almost since inception of GST regime. The lesser GST rates slabs would undoubtedly ease the complexity of GST systems.
