GST is not increasing burden on people, says FM Nirmala Sitharaman

With the Opposition seeking to corner the Narendra Modi government on price rise, Finance Minister Nirmala Sitharaman on Tuesday said the Goods and Service Tax (GST) is not increasing the burden on families. She also said the Modi government has contained the prices of tomato, onion and potato compared to 2013 rates.

She said the GST Council has not imposed any new levy on essential items consumed by the poor, though every state had one or the other tax on essential items.

Replying to a short duration discussion on price rise in Rajya Sabha in which a number of MPs, including from the Opposition, participated, she also countered the narrative that Opposition-ruled states were in disagreement in imposing 5 per cent GST on certain essential items and services.

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Trinamool Congress MPs walked out of the Rajya Sabha during the Minister’s reply after the Chair did not allow floor leader Derek O’Brien to raise a point of order.

"We expected FM to respond to 6 specific issues we raised. She did not. She was more interested in running down Opposition states rather than looking for solutions to price rise and GST. TMC walked out in protest," O’Brien tweeted.

As the Opposition MPs attacked the government, Nirmala said,"GST has not increased the burden on families. The rates were far higher (in pre-GST era)." To buttress her point, she cited the rates of the taxes on tooth powder, toothpaste and soap among others.

She said the 29.3 per cent pre-GST taxes on toothpaste and soap were lowered to 18 per cent in the GST regime, while the 31.3 per cent tax on TV (over 32 inch), washing machines, vacuum cleaner and paints were decreased to 18 per cent. She also said the 17 per cent pre-GST tax on tooth powder was lowered to 12 per cent, footwear over Rs 1,000 was lowered to 18 per cent from 21 per cent and LPG stove from 21 per cent to 18 per cent. “Families are now buying things at far less rates,” she said.

Countering Opposition charges, she said all states at the GST Council agreed to the proposal to levy 5 per cent GST on pre-packed, labelled food items and none spoke against it.

She said there was no GST on crematorium as claimed by the Opposition and the tax is only on construction of new crematorium. She also sought to dispel confusion over GST on hospitals, saying there is no GST on hospital beds or ICU. The tax is only on rooms with Rs 5,000 per day rent, she added.

The Minister also clarified that the GST is only on banks purchasing cheque books from the printer and there is no tax on customer cheques. She also added that there is no GST on withdrawal of cash from banks.