India Inc has hailed the passage of Constitution Amendment Bill to enable the GST regime by the Upper House as the “most-awaited tax reform” and also the “biggest reform since 1991.”
Ashok P. Hinduja, Chairman, Hinduja Group of Companies, India said it will make India an attractive destination for foreign investments.
“Manufacturing will get more competitive due to the emergence of a national market as against the present fragmented one. The low tax to GDP ratio of the country will go up, helping the government to adhere to fiscal discipline and keep the inflation in check. It will improve productivity and transparency,” he added. He, however, said, “the GST rate above the range of 18-22 per cent will be regressive. Clarity is needed on the continuance of existing exemptions especially those linked to investment made both at the Centre and State levels. Input tax credit possible only after ensuring vendor remit the tax to their authorities – provision will be difficult to comply.”
“Full-fledged IT system should be in place so that there is no dispute in arriving at the losses incurred by States in the first five years. Roll over on April 1, 2017 may affect the last quarter business of 2016-17. Hence, implementation during mid 2017-18 would be ideal and preferable,” Hinduja said.
Rana Kapoor, Managing Director and CEO, YES BANK, said, “Implementation of GST in one sweep will lead to efficient allocation of resources, smoothen supply disruptions, harness inflation, aid tax buoyancy and improve compliance, thereby reinforcing conviction in ‘Believe in India’.”
Harshvardhan Neotia, President, FICCI, said that it was “heartening to see” that there is consensus emerging in passage of crucial GST bill, which is, “ one of the most awaited reform measures by the industry.”
“The cooperation extended by the Opposition to this crucial legislation is the cornerstone of democracy and gives industry a lot of hope on progress of reforms in the country”, he added.
Kamlesh Rao, CEO, Kotak Securities, said, this will send out a strong signal to the international markets that we are serious about reforms.
Sunil Kanoria, President, Assocham, said this will mark a new beginning of a “broad-based non-partisan political support for the critical economic reforms.”