GST may not lead to inflation if tax rate remains 18%: CAIT
08/08/2016 10:08
The Confederation of All India Traders (CAIT) has said that the standard tax rate near 18 per cent under GST will prove to be an ideal one and in all probability, will not stoke significant inflation as assumed by many. As per reports, finalisation of the tax rate depends much on classification of goods and services under the exempted category and also under nominal tax rate which may be 1 per cent. Commenting on the issue, CAIT national President B C Bhartia and Secretary General Praveen Khandelwal said, “Under the current VAT regime, items placed under the 5 per cent tax slab will be attracting standard rate of tax, which may be 18 per cent, and it is feared that such a situation will lead to inflation.” “Under GST, these will be placed under a higher slab and will be eligible for input tax credit for not just goods but services. In spite of all these mathematics, in initial days, there might be some inflation which will subside once the taxation system is duly adopted in its letter and spirit,” they added.
08/08/2016 10:08
