PANAJI
Goa Chamber of Commerce & Industry (GCCI) President Pratima Dhond has wholeheartedly welcomed the far-reaching GST reforms announced at the 56th GST Council Meeting.
In a press statement, the GCCI said it has consistently pressed for rationalisation of GST slabs and simplification of procedures.
“The present revamp, which introduces a simplified two-slab structure (5% and 18%) with a special 40% slab only for luxury and sin goods, will have a significant positive impact on the Indian economy. This rationalisation will ensure stability and confidence in the GST regime, encouraging greater compliance and reducing litigation,” stated the GCCI.
The GCCI also noted with appreciation the Council’s emphasis on simplifying registration, return filing and refunds, a long-standing demand of trade and industry. The operationalisation of the GST Appellate Tribunal will further enhance trust, transparency, and ease of doing business.
Balanced approach
While the government may face an estimated annual revenue loss of Rs 0.7“1.8 trillion due to the reductions, the GCCI said this has been prudently addressed by maintaining a special 40% GST slab on luxury and sin goods such as pan masala, aerated beverages, and tobacco products.
“This across-the-board reform is not only pro-business and pro-consumer, but also pro-society. By making insurance and healthcare affordable, while boosting consumption and competitiveness, the GST reforms will go a long way in strengthening India’s economic growth and socio-economic fabric of our nation,” said GCCI President.
Benefits to economy, society
The GCCI highlighted several key benefits to economy & society.
Boost to GDP Growth: Rate cuts are expected to add 20“50 basis points to GDP growth, potentially raising the national growth rate by 0.5 percentage points.
Higher Consumption: Reduced rates will enhance disposable income and trigger pent-up demand for automobiles, consumer durables, apparel and other aspirational products.
Competitiveness for MSMEs: Lower compliance costs and reduced tax burden will directly benefit micro, small and medium enterprises.
Socio-Economic Gains: The removal of GST on all individual life and health insurance policies ” a long-standing public demand ” will make insurance affordable, widen coverage, and strengthen the country’s social safety net. This is a landmark step towards financial inclusion and social security.
Healthcare Relief: GST exemption on 33 lifesaving medicines, reduced rates on most other drugs, and cuts on medical equipment and devices will make healthcare more affordable.
Support to Farmers & Labour-Intensive Sectors: Reduction in GST on tractors, agricultural equipment, handicrafts, marble, leather goods and textiles will provide relief to farmers, artisans, and workers.
Common Man Relief: Daily-use products such as hair oil, soaps, shampoos, toothpaste, bicycles, household items, namkeens, noodles, tea, coffee, milk products, and Indian breads have been brought under the 5% or NIL category, directly benefiting households.
Simplified Tax Structure: Rationalising GST rates can simplify the tax system, reducing complexities and litigation, and making it easier for businesses to comply.
Increased Consumption: Lower GST rates can lead to higher disposable income, resulting in increased consumption, particularly for discretionary items like automobiles, air conditioners, and electronics.
Increased Demand: Lower GST rates will trigger pent-up demand for aspirational products, including home appliances and apparel.
Mitigating US Tariff Impact: The GST rate cuts will surely help to cushion the domestic economy from the adverse effects of US tariffs.
