Facing a shortfall of over Rs 40,000 crore in goods and services tax collection, the Centre on Saturday suggested that there was a need to pause on rate cuts for the time being.
At a meeting of the GST Council, one of the states that had skipped the set of discussions on July 21 when rates on 88 products were slashed proposed that ministers from the states and the Centre should reduce the levy on cement from 28% to 18%, a move that is estimated to leave an annual dent of Rs 15,000-20,000 crore. This prompted Piyush Goyal, who was chairing the meeting, to suggest to ministers that there should be a pause, a term drawn from RBI, which uses it when interest rates are left unchanged, a senior government official told TOI.
Besides, sources said the meeting had been convened largely to discuss issues related to micro, small and medium enterprises, and a rate cut was not on the agenda. Goyal’s assertion stems from the assessment that the government is behind the asking rate on GST tax collections, partly because of the rate cuts and also because collections have not kept pace with the monthly target of around Rs 1 lakh crore.
via Rs 40,000 crore GST shortfall pauses rate cuts for now – Times of India
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