Benz car vs hawai chappal: Nirmala Sitharaman explains why India isn’t ready for one GST rate
Speaking after the rollout of GST 2.0 on September 22, the Finance Minister said the government's immediate focus is ensuring that tax cuts translate into real benefits for consumers.
- Sep 5, 2025,
- Updated Sep 5, 2025 3:21 PM IST
A uniform Goods and Services Tax (GST) across India is not feasible at the moment due to uneven levels of development, Union Finance Minister Nirmala Sitharaman said in an exclusive interview with India Today TV. While the 'One Nation, One GST' vision remains intact, she noted that such a framework can only be considered once the country achieves balanced growth across all regions.
Explaining the rationale behind the current multi-slab GST structure, Sitharaman said different regions in India are at varying levels of economic development, making it impractical to impose the same tax rate nationwide.
Recalling her interaction with late Arun Jaitley, who introduced the GST, she said “can a Benz car and a hawai chappal be treated the same way and have one tax”.
“A person buying a hawai chappal is not in a position to pay more tax than the one buying a Benz car. On the other hand, the person buying the Benz car is at a position to pay more. So, for an India where it stands today a uniform rate for a Benz car and a hawai chappal it will be unjust,” she said, adding “That’s why there is no uniform GST rate at the moment.”
In her first post-reform interview, Sitharaman stressed that an uniform GST rate could be considered only when economic parity is achieved across the country.
Speaking after the rollout of GST 2.0 on September 22, the Finance Minister said the government's immediate focus is ensuring that tax cuts translate into real benefits for consumers. She said strict monitoring will be in place to verify that industries, including insurance, pass on the benefits.
She also confirmed there are no current plans to bring petrol and diesel under GST or restore input tax credit (ITC) for real estate developers, despite ongoing demands from the industry.
A uniform Goods and Services Tax (GST) across India is not feasible at the moment due to uneven levels of development, Union Finance Minister Nirmala Sitharaman said in an exclusive interview with India Today TV. While the 'One Nation, One GST' vision remains intact, she noted that such a framework can only be considered once the country achieves balanced growth across all regions.
Explaining the rationale behind the current multi-slab GST structure, Sitharaman said different regions in India are at varying levels of economic development, making it impractical to impose the same tax rate nationwide.
Recalling her interaction with late Arun Jaitley, who introduced the GST, she said “can a Benz car and a hawai chappal be treated the same way and have one tax”.
“A person buying a hawai chappal is not in a position to pay more tax than the one buying a Benz car. On the other hand, the person buying the Benz car is at a position to pay more. So, for an India where it stands today a uniform rate for a Benz car and a hawai chappal it will be unjust,” she said, adding “That’s why there is no uniform GST rate at the moment.”
In her first post-reform interview, Sitharaman stressed that an uniform GST rate could be considered only when economic parity is achieved across the country.
Speaking after the rollout of GST 2.0 on September 22, the Finance Minister said the government's immediate focus is ensuring that tax cuts translate into real benefits for consumers. She said strict monitoring will be in place to verify that industries, including insurance, pass on the benefits.
She also confirmed there are no current plans to bring petrol and diesel under GST or restore input tax credit (ITC) for real estate developers, despite ongoing demands from the industry.