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Informist, Tuesday, Sept. 23, 2025

 

--CBIC member: See good response from cos in passing on GST rate cut benefit 
--CBIC member: Watchful of profiteering of cos post GST rate cut 
--CBIC member: Hope GST reforms to bring in pvt investment lacking so far 
--CONTEXT: CBIC Member Shashank Priya speaking ASSOCHAM conclave on GST 2.0 
--CBIC member: Appetite for GST reform still there, will continue to work on it

 

NEW DELHI – As the first leg of the next-generation goods and services tax reforms kickstarted Monday, Central Board of Indirect Taxes and Customs Member (GST) Shashank Priya said that there is still appetite for more reforms and the GST Council is working towards making the indirect tax structure better. "Since 2017, there has been 200% growth in GST revenues, 100% growth in tax base, but there remains more scope for formalisation (of the economy)," Priya said Tuesday at Associated Chambers of Commerce and Industry of India's National Conclave on GST 2.0.

 

"We hope the economy gets kickstarted so that the fear of revenue loss is minimal," he said. The CBIC member also said that the benefit of lower GST rates will boost consumption in the economy and help bring in private investments "which has been lacking".

 

On Sept. 3, the GST Council overhauled the indirect tax regime by collapsing the four-slab GST structure of 5%, 12%, 18%, and 28% to a two-slab structure of 5% and 18%. The council also introduced a new GST rate of 40% on sin and luxury goods. All the new rates, except for those on tobacco products, took effect from Monday.

 

The GST Council segmented the two broad GST slabs on the tenets of 'merit' and 'standard', putting a majority of common-use items in the 5% slab, thereby bringing down the effective average GST rate. A host of white goods, especially consumer durables like washing machines and big televisions were moved to the 18% slab from 28%, thereby lowering the average GST rate. The entire tax structure changes will lead to an annual revenue loss of INR 480 billion. 

According to Priya, the next set of reforms needed to the GST structure include easing the compliance burden of small businesses. The council is already working on allowing GST registration within three working days which will be a huge boost to businesses with smaller turnovers, he said.

There is already work going on to make the GST refund process automated with an intent to cut down the processing time, he said. The council is also working on making the e-invoicing process simpler so that businesses with lower turnover can be integrated into the GST net more seamlessly. Priya also said that the council will look into simplifying the GST audit structure by streamlining one audit partner with a particular Permanent Account Number-registered business.

Speaking about the reforms that have already been rolled out, the CBIC member said in an environment where GST anti-profiteering provisions don't exist, the government is interacting with industry to ensure the GST cut benefits are passed on to end consumers. We are watchful of profiteering by the companies following the GST rate reduction and so far, we are seeing good response from companies in passing on the benefits, he said.

 

The finance ministry has asked its field officers to compile monthly data reports on changes in prices of common-use articles for six months, with the first data report to be submitted to the ministry by Sept. 30. The letter, seen by Informist, asks the field offices to treat the exercise "on priority". The data has to include the name of the commodity, brand, and maximum retail price before and after Monday.

Speaking about further widening the GST net, Priya said that few discussions have happened within the GST Council to bring fuel products like aviation turbine fuel under the ambit of GST but it is not the appropriate time to go forward with this move. We need to see the "dust settle" from the recent reforms before we can think of bringing fuel, ATF under GST, he said. "I don't think it will happen for at least one more year," he added. Currently, fuel products are out of the ambit of GST and attract excise duty along with state-administered value added tax.  End

 

Reported by Priyasmita Dutta

Edited by Akul Nishant Akhoury

 

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