New Delhi [India], September 4 (ANI): The next-generation Goods and Services Tax (GST) reforms, announced after the GST Council meeting on Wednesday, have received strong praise from industry leaders and experts, who, in a united voice, asserted that such bold measures will strengthen economic growth, push investments, and ease of living.
Ashishkumar Chauhan, MD and CEO of the National Stock Exchange (NSE), described the reforms as a landmark step forward.
“These reforms will certainly improve economic growth rate even further,” the NSE chief said.
Chauhan highlighted the broader impact of the changes. He noted that the GST reforms will reduce the overall tax burden on citizens and businesses, thereby boosting profitability, productivity, and investments that drive India’s economic growth.
He also believes that it will strengthen tax compliance by simplifying structures and encouraging broader participation in the formal economy.
“The capital markets welcome these steps and stand ready to support the next phase of India’s development journey,” Chauhan concluded.
Nilesh Shah, Managing Director of Kotak Mahindra Asset Management Company, termed the GST slab and rate rationalisation as well as the process improvement a step in the right direction.
“The latest GST announcement lowers inflation, increases growth, boosts consumer sentiment, doesn’t disturb path of fiscal consolidation, improves ease of doing business and partially offers adverse effects of tariffs,” Shah said.
Shah believes that rationalisation of GST will partially help offset the adverse impact of US tariff in the quarters to come.
Aditi Nayar, Chief Economist at ICRA Ltd., also believes that the GST reforms will help offset a part of the negative impact of the evolving US tariffs.
Any revenue foregone by the Centre and the states would effectively need to be compensated through other revenue streams or expenditure rationalisation, Nayar suggested.
The GST rate cuts have a financial implication of Rs 48,000 crore on the government’s exchequer in net terms, the government has estimated.
“Given the earlier-than-expected implementation of the GST rationalisation at the onset of the consumption-heavy festive period, the moderate revenue likely to be foregone in the second half of this fiscal–which would nevertheless necessitate other revenue mobilisation or expenditure-saving measures…,” Nayar added.
The sweeping changes have been made under the next-generation GST (Goods and Services Tax) rationalisation just days after Prime Minister Narendra Modi announced it from the ramparts of the Red Fort on Independence Day.
This is aimed at reducing the tax burden on citizens while stimulating economic growth. The GST reforms are part of the government’s efforts to stimulate economic growth and reduce the tax burden on citizens. The changes are expected to have a positive impact on various sectors, including agriculture, and drive GDP growth.
The GST Council, on Wednesday, after a threadbare discussion, approved significant rate cuts across multiple sectors, which the government has described as a Diwali gift for the nation. On the essential items front, items of daily household use will now cost less.
The 56th GST council meeting decided to rationalise GST rates to two slabs of 5 per cent and 18 per cent by merging the 12 per cent and 28 per cent rates. (ANI)
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