The Congress on Sunday alleged that the revamped Goods and Services Tax system that will come into effect from September 22 is a “mere band-aid”, and that the reforms are inadequate.

The new GST system, which will entail a primarily two-rate structure of 5% and 18% tax slabs, will take effect on September 22 for most items. The GST Council had cleared the new slab structure on September 3.

Earlier on Sunday, Prime Minister Narendra Modi said that the GST reforms will “accelerate India’s growth story” and enhance the ease of doing business. He claimed that the new system would lead to a “festival of savings” for citizens.

However, Congress chief Mallikarjun Kharge said that the Modi government should seek an apology from citizens.

“Instead of the Congress’s simple and efficient GST, your government imposed a ‘Gabbar Singh Tax’ in the form of nine separate slabs, and collected more than Rs 55 lakh crore in eight years,” the Congress president said on social media. “Now, by talking about a Rs 2.5 lakh crore ‘savings festival’, you are seeking to apply a mere band-aid after inflicting deep wounds on the public.”

Kharge said that citizens “will never forget” how the government taxed essentials such as foodgrains, healthcare and farm equipment.

Congress general secretary in-charge of communications Jairam Ramesh also alleged that the current GST reforms are inadequate.

The concerns of micro, small and medium enterprises must be addressed meaningfully, the Congress MP said. “Sectoral issues that have surfaced – for instance in textiles, tourism, exporters, handicrafts and agricultural inputs – must be tackled,” he added.

Ramesh said that state governments should be incentivised to move towards a state-level GST that would cover electricity, alcohol, petroleum, and real estate.

He further contended: “The key demand of the states made in the true spirit of cooperative federalism – namely, the extension of compensation for another five years to fully protect their revenues – remains unaddressed.”

GST revamp

The GST Council had cleared the new two-rate slab structure on September 3.

With this, daily-use goods such as soaps, shampoos, butter, ghee, utensils and stationery will get cheaper. Additionally, health and life insurance will attract no GST. Rates have also been reduced on vehicles and electronic appliances such as televisions and washing machines.

The GST system took effect in July 2017, replacing several indirect taxes such as the Value Added Tax and the Central Excise Duty.

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