Union Finance Minister Nirmala Sitharaman on Friday said that there was no discussion on GST rate hike yet.
"The buzz is everywhere except in my office. I have had no conversations on the GST Council meeting with my team yet," said Sitharaman while addressing a press meet at the National Media Centre in New Delhi.
There have been reports that the GST Council, chaired by Finance Minister Nirmala Sitharaman, could increase taxes as revenue collection fell short of expectations in the last few months. Data released earlier this month showed that GST revenue rose to Rs 1.03 lakh crore in November, reversing two months of decline. GST revenue collection in September and October were Rs 91,916 crore and Rs 95,380 crore, respectively.
According to various media reports, the government could boost its revenues by more than 1,000 crore per month if it increases the current 5 per cent tax rate on essential products (which includes fabric) and services to 6-8 per cent. The GST Council is set to meet on December 18 in the backdrop of lower-than-expected GST collection and pending compensation to many states.
As of now, all products and services fall under four tax slabs under the GST regime - 5, 12, 18 and 28 per cent. The 5 per cent slab includes essential commodities such as food items, footwear and basic clothing. Restructuring the slab rates might aid the government to garner additional revenues of Rs 1,000 crore per month.
In the recent months, the government has announced a slew of measures, including cut in corporate taxes, disinvestment in five blue-chip PSUs, setting up a special real-estate fund and merger of banks, to boost economic growth which fell to a record low of 4.5 per cent during September quarter, down from 5 per cent in the previous three months and 7 per cent for the same period of 2018.
Edited by Chitranjan Kumar