Experts about Implications of Higher GST Tax Slabs
GST Tax Slabs became the hot topic now. Ahead of the GST Council Meet on December 18 market experts spooked on the implications of GST Tax Slabs, and shared their viewpoints in an interview to the CNBC TV 18.
Sources are suggesting that the Government is likely to increase GST tax rates in order to increase its revenue collections. In addition, it is looking at the various revenue-raising measures. Is it the right time to increase GST Tax Slabs?. 
Q: The received wisdom from economy says that 5 and 12 per cent are only contributing about 10 or 20% of GST.  If resource mobilisation is a goal should we worry 18% category could be touched or could be hiked?
On this, the expert said we could notice the divided views. Some were expecting at least 22 per cent.  
“In Indirect tax revenue collection is not directly proportional to the rate increase. By and large, it is inversely proportional. The consumption will fall followed the increase in the rate.   Eventually, the collections will decline. This has bee seen in empirical evidence to that effect,” said the expert. 
He further added that looking at the current economic conditions, I would wish the GST council not to increase the rates too much. However, if they want to really combine the different slabs 5 and 12 per cent into one category of 8-9 per cent. I think that is a good idea that will simplify the tax structure.
One would look at the individual item say 5% it can become 8 or not. You have real estate, transportation, restaurants, fertilizers, medicines and so many items can it be increased to 8% that’s an issue for each product, category, each industry will have to look at.
However, saying that these are the 20 products that deserve to be tax at a higher rate. I don’t think that is a good idea in the present economic conditions. 
Certainly, there are pressures in revenue collection and Govt has done a good job on that in terms of increasing the sort of compliances, and looking at the data analytics etc. They should continue with that effort. If all goes well within 6 to 8 months from now we will be in a better position. 
We do know that consumer durables come into both 18 and 28 % category. Particularly, Air Conditioner, Refrigerator, and Television etc all come into the 28% category. What is your viewpoint? Do you think that the slab will go up? If it does what kind of deterrent would it be to demand? Higher GST Tax Slabs
Another Expert replied to this question. He feels the tax rates on consumer durables should not be increased. The consumer durables like Air conditioner and TV come under 28% category whereas appliances come under the 18% category. I think mobiles are in the 12% category. In any category, the tax goes up definitely the demand will go down. The government is likely to collect more tax by increasing the rate and more revenue by increasing the rate. I think Higher GST Tax Slabs will not happen. 
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