By Admin 
GST 2.0: The Government of India is preparing to implement two-tier GST structure by October this year. It is being talked about keeping the tax slab of 2 percent and 28 percent and keeping the slab of 5 percent and 18 percent. Of course, things that work in everyday life will become cheaper, such as FMCG, cement, small cars and air conditioner will become cheaper.
However, this may cause the government to suffer a loss of up to 85,000 crores annually. The report estimated that between October to March in the business year 2025-26, the government may face a loss of about Rs 45,000 crore. The good thing is that it is also expected to reach about 1.98 lakh crores of congestion.
On August 15, Prime Minister Narendra Modi indicated the improvement of the next generation in GST from the ramparts of the Red Fort on the occasion of Independence Day. This will cause revenue loss to the government, but if consumption increases, then the economy will be strengthened. Its effect will be seen on the GDP of the country. This has been revealed in a report of SBI Research.
Things will be distributed in two categories
Since there will be only two tax slabs under the new system. Accordingly, things will be divided into both ‘standard’ and ‘necessary’ categories. A tax of up to 40 percent will be charged on selected things like paan masala, tobacco and online gaming. SBI research has stated that Weighted Average GST Rate has been continuously decreasing from the year 2017. In this way, it has declined by 14.4 percent to 11.6 percent by September 2019 and now with amendment in rates, this figure can go down to 9.5 percent.
Inflation may fall
Even though the GST reforms damage the revenue, it is expected to bounce 0.6 percent in the GDP. The economy of the country will get the support of strong consumption of items consumed. It was also told in the report that this step of the government is also not likely to increase inflation because the goods of common consumption will become cheaper. Under the new system, the Consumer Price Index (CPI) inflation may decrease by 20-25 basis points. The Finance Minister of the states will discuss this proposal of the government on Wednesday and Thursday. If agreed, it will be kept in the meeting of GST Council next month.
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