FinMin batting for a moderate GST rate

The Centre has been looking at 24 percent Goods and Services Tax rate (GST). Given the changes made in the Constitutional Amendment Bill and the exclusion of petro products from the GST chain, states will get two years to levy a one percent additional tax.

Keeping this is mind a new revenue-neutral rate (RNR) is being worked out by the National Institute of Financial Policy. They are likely to submit this formula to the Centre within a month after which there will be detailed discussion between Centre and the state in this front, though of course it is the GST council that will finally decide what is to be done and that is a long way away.

The fact remains that the government is worried as there is a lot of apprehension with the recent service tax rate hike.