Next Gen GST: Sweeping Reforms for Economic Boost

The 'Next Gen GST' proposes major tax reforms with two slabs of 5% and 18%. Aimed at economic growth, the overhaul seeks to end tariff threats and ensure stability. The proposal promises a single tax rate regime in the future, depending on India's development as a nation.

The Indian government is preparing to roll out sweeping reforms under a new Goods and Services Tax (GST) regime, dubbed 'Next Gen GST', that aims to revitalize the economy amidst ongoing tariff threats.

The reforms propose slashing tax rates to just two slabs—5% and 18%—from the current four, boosting economic activity and consumption by making daily-use items more affordable. Officials stated that as the nation progresses, a single tax rate regime could be envisioned.

The GST overhaul, subject to approval by the GST Council, has been meticulously planned over months to prevent any undue accumulation of Input Tax Credit (ITC) and stabilize tax rates. These changes follow recent tariff increases on Indian goods exported to the US.

(With inputs from agencies.)