Structure GST to globally comparable framework before implementing it: economist

Chennai:

The Goods and Service Tax has many lacunae and there is a need to structure it in globally comparable framework before implementing it, according to a noted economist.

Speaking on the Third Annual Day and Book Release function of Chamber of Indirect Tax Professionals here on Saturday, director and chief executive of Indian Council for Research on International Economic Relations Parthasarathi Shome said the tax rate on goods and services are yet to be decided and not having the same tax rates for goods and services would be a major lacuna since classification problems would soar in contrast to an ideal GST.

Shome, who was also the former finance advisor to Union government, said that the GST base would exclude petroleum products and alcoholic beverages which is a major lacuna in contrast to global GST systems.

He also said that with the center having more say on changes in the GST structure, the federalism principles will be challenged as the states will be relegated to supporting role.

He also suggested new language, new approach, new commitments and new applications for modernising tax administration.

He stressed on two essential and minimum components of the modernisation process which include intensive and continuing background analysis for measures of tax administration policy and the growing need for specialisms within the field of tax administration.
Shom said the world has progressed a long way already and it is time for those administrations that have lagged behind to move forward from their autarkic stance and catch up with the rest.

His book Tax Shastra – Administrative Reforms in India, UK and Brazil was released by R Sekar, Commissioner Appeals, Central Excise, Pune during the occasion.