Gulmarg: Inflation will fall by 2 per cent on implementation of the goods and services tax (GST) and create buoyancy in the economy, revenue secretary Hasmukh Adhia has said. With the stage set for the biggest overhaul of India’s tax system since independence, the Centre will launch a massive awareness campaign to educate consumers about GST so that they are not fleeced by traders in the name of new tax.
In an interview to PTI, he said the all-powerful GST Council will meet next week to decide on tax rates of contentious items like gold, bidi and biscuits, just in time for its rollout from July 1. The Council over the two days last week assigned tax rates to more than 500 services and 1,200 goods by setting them in five broad rates of 5, 12, 18 and 28 per cent.
The rates, Mr Adhia said, have been so fixed that incidence of taxation has come down in many and remained at the same level as now in most of the remaining goods and services.
“I don't think inflation will at all go up because of GST. We have taken special care to ensure inflation does not go up. Our internal estimate is that after the rates are decided, inflation should come down by 2 per cent,” he said.