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Surprised at GST objections, but haven’t lost hope: Jaitley | Canindia News

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Surprised at GST objections, but haven’t lost hope: Jaitley

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New Delhi, Jan 30 (IANS) Finance Minister Arun Jaitley on Saturday said he was surprised when the Congress party voiced its objections to the goods and services tax bill after initiating it, but hoped it will see a passage in parliament considering its larger impact on the economy.

“It was they (the Congress party) who started the process. So I was surprised when they came up with these three objections,” Jaitley told the Economic Times Global Business Summit, but added: “I hope they are flexible and see the rationale behind passing the GST.”

The Congress party has desired that the government scrap the proposed 1 percent additional levy to compensate states for losses on account of the switch to GST, incorporate the GST rate within the bill and limit the items that will be excluded from this pan-India levy.

The finance minister pointed out that a Congress finance minister, P. Chidambaram, had initiated the process for a pan-India goods and services tax, and his successor Pranab Mukherjee, now the country’s president, had introduced the enabling constitution amendment bill.

Jaitley also said that if the larger goal of reforms has to be achieved, India must grow faster so that people are lifted out of poverty. “The Indian normal has to be in the 8-9 percent,” he said, a day after the GDP growth for 2013-14 was lowered by 10 basis points to 7.2 percent.

“It’s only at this pace you can get rid of poverty,” he said, adding: “When India is referred to as a bright spot, we feel happy, we feel proud. Having said that we still have sleepless nights. We probably also have the potential to achieve faster growth.”

The finance minister also took up the point made by Prime Minister Narendra Modi a day ago at the same platform on subsidies that such doles cannot evoke ideological positions and must go to the deserving, by whatever name they are called.

“The government is not against the concept of subsidies,” finance minister Jaitley said. “We are for rationalisation, not abolition.”

The prime minister had said that while doles given to the poor were called subsidies, those being extended to the well off were portrayed positively. “Let me give you an example. The revenue loss from incentives to corporate tax payers was over Rs. 62,000 crore,” Modi had said.

“Dividends and long term capital gains on shares traded in stock exchanges are totally exempt from income tax even though it is not the poor who earn them. Since it is exempt, it is not even counted in the Rs. 62,000 crore,” he said.

“I am not arguing that all subsidies are good. My point is there can’t be an ideological position on such matters. We have to be pragmatic. We have to eliminate bad subsidies, whether or not they are called subsidies.”

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