Congress demands official paper on GST 2.0, calls for 'Good and Simple Tax'

The party emphasised that reforms should minimize revenue uncertainty for states.Congress Has Been Demanding GST 2.0 for Over One-and-a-Half Years.

Congress General Secretary Jairam Ramesh, in a statement, said, "For over one-and-a-half years, Congress has been advocating for a transformative GST 2.0.

This was a key promise in the Congress manifesto for the 2024 Lok Sabha elections. Yesterday, the Prime Minister finally acknowledged that without these changes, along with increased private consumption and investment, economic growth cannot accelerate."

He added, "Over the past seven years, the spirit of GST has been undermined by rising tax rates and numerous exemptions, seemingly encouraging tax evasion."

Ramesh stressed the need for significant reductions in GST rates and simplification of the rate structure to minimize revenue uncertainty for states and resolve classification disputes, which have become common.

He noted, "The GST compensation cess is set to expire on March 31, 2026. Its duration should be extended to address any revenue uncertainties arising from rate rationalisation."

He suggested increasing thresholds for interstate supplies and resolving sectoral issues in areas like textiles, tourism, exporters, handicrafts, and agricultural inputs.He further proposed encouraging states to implement state-level GST to include sectors like electricity, alcohol, petroleum, and real estate.

Ramesh reiterated, "Congress demands an official discussion paper on GST 2.0 to enable a comprehensive debate on this critical national issue. GST 2.0 must truly be a 'Good and Simple Tax,' not a 'Development Suppressing Tax' as it has become."

An official discussion paper is a document issued by the government to invite public and stakeholder input before finalizing a policy or law.

The central government has proposed a revised GST structure with only two tax rates—5% and 18%—expected to be implemented by Diwali. High-level sources confirmed on Friday that the government has sent this proposal to the Group of Ministers (GoM) formed to rationalize GST rates, eliminating the existing 12% and 28% slabs.PM Announced GST Rate Reduction

During his address on the 79th Independence Day, Prime Minister Narendra Modi announced a significant reduction in GST rates by Diwali, stating it would provide relief to the common man and small and medium enterprises.