What makes for an ideal GST rate? Harsh Mariwala has the answer

With hopes of the Goods & Services Tax (GST) getting passed in the Monsoon Session of the Parliament, companies are busy looking at figures that will benefit their respective industries. The key thing to watch would be GST rates, says Harsh Mariwala, CMD of Marico. A Revenue Neutral Rate (RNR) of 20-22 percent and a Merit List Rate of 8-10 percent will be ideal from a consumer point of view, he says. Merit List rate will be applicable on all essential commodities. Currently, 6-8 percent tax is put on essential commodities. If the rates are higher, companies will likely pass on the added expenses to customers, which could lead to a rise in inflation in the economy, he says. However, if rates are lower, benefits too will be passed onto consumers. Watch video for more...