Latest news with #GST2.0
Mint
3 days ago
- Business
- Mint
Indian economy to grow 6.4-6.7% in FY26 amid geopolitical risks, says CII president; 3-tier GST structure backed
The Indian economy is estimated to grow 6.4-6.7 per cent in the current financial year due to strong domestic demand amid risks posed by geopolitical uncertainty, the newly appointed CII President Rajiv Memani said during a press conference on Thursday. He further advocated for a three-tier goods and services tax (GST) rate structure, with essential goods attracting 5 per cent, luxury and sin goods at 28 per cent, and the rest of the items in the 12-18 per cent range. The current GST system is a four-tier tax structure with 5 per cent, 12 per cent, 18 per cent and 28 per cent slabs. Luxury and demerit goods fall under the highest slab of 28 per cent, while packed food and essential items are charged the lowest 5 per cent slab. Speaking on India's growth, Memani said that factors such as a good monsoon forecast, liquidity boost due to the Reserve Bank of India's (RBI) cash reserve ratio (CRR) cut, and interest rate reduction will help in the economic growth of the country. Highlighting risks for the Indian economy, Memani said, 'A lot of these relate to external trade risk. I think a lot of them have been factored in, and also there are some upside. So hopefully they should get balanced out... From a CII standpoint, we're looking at 6.4-6.7 per cent growth.' However, Memani assured that these risks to growth are evenly balanced, and geopolitical uncertainty poses downside risks whereas strong domestic demand is an upside. According to the RBI forecast, the economy is estimated to grow 6.5 per cent in FY26. In June, the central bank slashed the CRR by 100 basis points, which is expected to boost liquidity by bringing ₹ 2.5 lakh crore to the banking system. Meanwhile, the benchmark interest rate was cut 50 basis points to 5.5 per cent. Memani emphasised that GST requires rate rationalisation. 'Under GST 2.0, we have called for rate rationalisation, especially on products that are consumed by lower-income segments. Several products taxed at 28 per cent, including cement, should also be reduced... we believe this will boost economic activity,' he said. Memani also urged simplifying the GST framework and emphasised the importance of building a national consensus on goods such as petroleum, electricity, real estate, and potable alcohol in GST.
Mint
3 days ago
- Business
- Mint
Indian economy to grow 6.4-6.7% in FY26 amid geopolitical risks, says CII President, calls for 3-tier GST structure
The Indian economy is estimated to grow 6.4-6.7% in the current financial year due to strong domestic demand amid risks posed by geopolitical uncertainty, the newly appointed CII President Rajiv Memani said during a press conference on Thursday. He further advocated for a three-tier goods and services tax (GST) rate structure, with essential goods attracting 5 per cent, luxury and sin goods at 28%, and the rest of the items in the 12-18% range. The current GST system is a four-tier tax structure with 5%, 12%, 18% and 28% slabs. Luxury and demerit goods fall under the highest slab of 28%, while packed food and essential items are charged the lowest 5% slab. Speaking on India's growth, Memani said that factors such as a good monsoon forecast, liquidity boost due to the Reserve Bank of India's (RBI) cash reserve ratio (CRR) cut, and interest rate reduction will help in the economic growth of the country. He highlighted risks for the Indian economy and said, 'a lot of these relate to external trade risk. I think a lot of them have been factored in, and also there are some upside. So hopefully they should get balanced out... From a CII standpoint, we're looking at 6.4-6.7 per cent growth.' However, Memani assured that these risks to growth are evenly balanced, and geopolitical uncertainty poses downside risks whereas strong domestic demand is an upside. According to the RBI forecast, the economy is estimated to grow 6.5% in FY26. In June, the central bank slashed the CRR by 100 basis points, which is expected to boost liquidity by bringing ₹ 2.5 lakh crore to the banking system. Meanwhile, the benchmark interest rate was cut 50 basis points to 5.5 per cent. Memani emphasised that GST requires rate rationalisation. 'Under GST 2.0, we have called for rate rationalisation, especially on products that are consumed by lower-income segments. Several products taxed at 28 per cent, including cement, should also be reduced... we believe this will boost economic activity,' he said. Memani also urged simplifying the GST framework and emphasised the importance of building a national consensus on goods such as petroleum, electricity, real estate, and potable alcohol in GST. He further mentioned that India needs to capitalise on the current opportunities, 'it will need to undertake more economic reforms, win the AI race and possible impact on jobs, grow high-end and employment intensive manufacturing and continuing focus on Ease of Doing Business.'
Mint
25-06-2025
- Business
- Mint
GST@8: Why businesses like GST and what they want next
New Delhi: Indian businesses are pitching for more reforms to improve the efficiency of goods and services tax even as they agree that the unified regime has transformed indirect tax administration over the past eight years, according to a survey. Better dispute settlement, rationalizing rates and faster refunds are among the priorities they highlighted, found the survey of 960 leaders from across the industry conducted by Deloitte India. After widespread technology adoption in the tax ecosystem, they are asking for 'thoughtful refinements' to further improve the GST portal's efficiency, the survey said. As high as 85% of the survey respondents, representing small and large corporations, highlighted a positive experience during their eight-year GST journey, the fourth edition of Deloitte's annual GST survey showed. The participants attributed that to digitization of compliances and proactive tax policy engagement, the survey said. GST perception improved among micro, small and medium enterprises, with 82% having a positive view this year compared with 78% in 2024. The respondents included executives in leadership positions across sectors covering technology, telecommunications, energy, banking, life sciences, consumer and global capability centres. More than two-thirds of those surveyed, up from 55% in 2024, acknowledged that clarifications and instructions issued under GST help resolve on-ground disputes, and 99% of the businesses have IT systems ready or partially ready for GST audits and notices. Auto-population of tax returns using e-invoicing data has emerged as the most user-friendly feature of the GST portal, reflecting the industry's preference for automated compliance, the survey pointed out. The survey captured a robust endorsement of the tax reform by businesses and they have expressed a strong sentiment to get to the next phase of GST reforms, Deloitte said in a statement. 'Confidence in GST has steadily risen from 59% in 2022 to 85% in 2025, driven by improved compliance maturity, digitization and proactive engagement by policymakers,' the statement said, quoting Gokul Chaudhri, president, tax, Deloitte India. The survey also captured the industry's suggestions for reforms. Priorities include strengthening the dispute-resolution mechanism, rationalizing rates across sectors, ensuring audit uniformity between central and state tax authorities and promoting exports by liberalizing rules. 'Persistent impediments' to ease of doing business include challenges in obtaining refunds, a limited understanding of new-age business models and expansive pro-revenue legal interpretations by authorities. 'Government should curb hasty assessments, enforce time-bound scrutiny processes and ensure implementation of GST circulars to provide clarity and certainty at ground level,' the survey said. 'Government is listening, and industry is ready to collaborate on shaping GST 2.0—a more streamlined, transparent and growth-friendly tax ecosystem.'
Economic Times
24-06-2025
- Business
- Economic Times
GST 2.0 and infra push could power India's next growth phase: Nilesh Shah
Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Popular in Markets "You have seen the reaction to gold prices , to crude oil prices . All of this we seem to be getting into kind of an environment of moderate inflation , subdued inflation, that has traditionally always been a challenge or a pain for India. So, clearly, honestly from a sentiment point of view and the emerging macro fundamentals, this is a great situation to be in," says Nilesh Shah , MD & CEO, Envision Capital I do not know about the multibagger ideas, but yes, today's interaction could not have been on a better day that when truce has been announced, ceasefire has been announced. At least it puts to rest any of the kind of geopolitical issues or tensions which probably the market had, got reflected a bit of that yesterday but thankfully today we are back to pretty much like business as usual or back to normal. And it honestly augers very well for the market. It augers well for have seen the reaction to gold prices, to crude oil prices. All of this we seem to be getting into kind of an environment of moderate inflation, subdued inflation, that has traditionally always been a challenge or a pain for India. So, clearly, honestly from a sentiment point of view and the emerging macro fundamentals, this is a great situation to be yes, from a pure macro and especially external macros, probably a lot of good news is out there. It is more about now what we do in terms of our own internal policy measures, economic reforms, and I am not talking of the big bang reforms, but just a few things could pretty much further not just the sentiment but also further lift up the fundamentals and contribute to earnings growth, I clearly believe something that we really need to look forward to and watch out for in 2025 is clearly going to be the GST 2.0, I mean that is something which has been in the works in terms of enough of reports out there in the media that the government is looking to now take GST to the next level whether it is in terms of cut in tax rates or whether it is in terms of rationalising taxes or reducing tax slabs and ease of implementation, all of that, I clearly believe that that is something which is probably less spoken about, less appreciated but I actually believe that is going to be very-very powerful, so that is two is upping up the spend on infra. I mean, this financial year the spend on infra pack was kind of pretty much at 3% which was in line with what it was last financial year. But there is room for that to kind of go up. I clearly do not think we have seen any peak of spending on infrastructure, till we get to at least 5% to 6% of the GDP which itself is growing. So, I probably believe that in the next few years you will probably see infra spend probably double or maybe even go even higher than these are some of the things which will continue to be very-very big growth drivers. These are things which will basically encourage businesses to grow and expand. So, on the whole, yes, apart from the global macros, I also believe our own domestic macros, policy measures, there is still lot of room for many things to I do not think because ultimately… I mean, this is a space, especially the largecap it has basically just been growing in about single digit. I believe that for a growth market like India where we have so many other growth options, unless you are essentially hugging the benchmark or want just basically the basic kind of largecap market returns, honestly as a bottom-up investor you probably do not have a compelling reason to be in largecap might be a good place to hide when there is enough correction and these are anyway very capital efficient companies and strong on governance as well. But beyond that, there is really nothing significant to really look out for. So, even in good times they were growing in single digits. If the US economy were to get challenged, global economies were to get challenged, even trying to grow in high single digit could be a huge-huge challenge for the big IT course, pockets remain in the midcap, smallcap IT space where they are specialising in specific domains, those kind of opportunities can remain, but otherwise the big IT companies, the best is behind absolutely. I mean, that has clearly been one of the strongest growth bastions that India has in the consumption space. Clearly post covid over the last five years the whole wave of premiumisation has caught on to the alcobev space. Indian companies have been hugely successful in being able to launch brands which essentially have got well received by consumers and Indian alcobev companies are only increasing their relevance to an ever growing consumer base in India. So, I still think it is still early are still very early on in terms of matrices like our per capita consumption and individual players continue to be on the journey of premiumisation which is driving their realisations, revenues, margins, cash flows. So, I still believe that the sector itself, the category itself still has many-many years to go.
Time of India
24-06-2025
- Business
- Time of India
GST 2.0 and infra push could power India's next growth phase: Nilesh Shah
"You have seen the reaction to gold prices , to crude oil prices . All of this we seem to be getting into kind of an environment of moderate inflation , subdued inflation, that has traditionally always been a challenge or a pain for India. So, clearly, honestly from a sentiment point of view and the emerging macro fundamentals, this is a great situation to be in," says Nilesh Shah , MD & CEO, Envision Capital . You have a reputation that when you come on air you will give multibagger ideas and the ideas what you give they may make money, that is the reputation you have earned. So, what do we start with market view or straight off to multibagger ideas? Nilesh Shah: I do not know about the multibagger ideas, but yes, today's interaction could not have been on a better day that when truce has been announced, ceasefire has been announced. At least it puts to rest any of the kind of geopolitical issues or tensions which probably the market had, got reflected a bit of that yesterday but thankfully today we are back to pretty much like business as usual or back to normal. And it honestly augers very well for the market. It augers well for India. You have seen the reaction to gold prices, to crude oil prices. All of this we seem to be getting into kind of an environment of moderate inflation, subdued inflation, that has traditionally always been a challenge or a pain for India. So, clearly, honestly from a sentiment point of view and the emerging macro fundamentals, this is a great situation to be in. They say good news and good price rarely comes together. Are we reaching what could be called as peak of good news because frankly there is nothing to really get worried about. Tariff seems to be getting settled. Interest rates have come down. Liquidity has increased. Promoter deals are back. What else could take the market higher? What could be the trigger because everything now what we wanted suddenly you have it on in front of you? Nilesh Shah: So, yes, from a pure macro and especially external macros, probably a lot of good news is out there. It is more about now what we do in terms of our own internal policy measures, economic reforms, and I am not talking of the big bang reforms, but just a few things could pretty much further not just the sentiment but also further lift up the fundamentals and contribute to earnings growth, I clearly believe something that we really need to look forward to and watch out for in 2025 is clearly going to be the GST 2.0, I mean that is something which has been in the works in terms of enough of reports out there in the media that the government is looking to now take GST to the next level whether it is in terms of cut in tax rates or whether it is in terms of rationalising taxes or reducing tax slabs and ease of implementation, all of that, I clearly believe that that is something which is probably less spoken about, less appreciated but I actually believe that is going to be very-very powerful, so that is one. Live Events And two is upping up the spend on infra. I mean, this financial year the spend on infra pack was kind of pretty much at 3% which was in line with what it was last financial year. But there is room for that to kind of go up. I clearly do not think we have seen any peak of spending on infrastructure, till we get to at least 5% to 6% of the GDP which itself is growing. So, I probably believe that in the next few years you will probably see infra spend probably double or maybe even go even higher than that. So, these are some of the things which will continue to be very-very big growth drivers. These are things which will basically encourage businesses to grow and expand. So, on the whole, yes, apart from the global macros, I also believe our own domestic macros, policy measures, there is still lot of room for many things to happen. When we interacted last, I remember you had a view on it wherein you said you were positive on the space. You also said that if Infosys corrects a further 10-20%, it would start looking like an attractive buy. Now with everything that has been happening globally, especially since Accenture's numbers have come, is that challenging your view on it at all? Nilesh Shah: No, I do not think because ultimately… I mean, this is a space, especially the largecap it has basically just been growing in about single digit. I believe that for a growth market like India where we have so many other growth options, unless you are essentially hugging the benchmark or want just basically the basic kind of largecap market returns, honestly as a bottom-up investor you probably do not have a compelling reason to be in largecap IT. It might be a good place to hide when there is enough correction and these are anyway very capital efficient companies and strong on governance as well. But beyond that, there is really nothing significant to really look out for. So, even in good times they were growing in single digits. If the US economy were to get challenged, global economies were to get challenged, even trying to grow in high single digit could be a huge-huge challenge for the big IT companies. Of course, pockets remain in the midcap, smallcap IT space where they are specialising in specific domains, those kind of opportunities can remain, but otherwise the big IT companies, the best is behind them. What about your view on the entire alcobev space? You have been positive on that space. We have not seen much happen on that front as well. Are you still looking positive there? Nilesh Shah: Oh, absolutely. I mean, that has clearly been one of the strongest growth bastions that India has in the consumption space. Clearly post covid over the last five years the whole wave of premiumisation has caught on to the alcobev space. Indian companies have been hugely successful in being able to launch brands which essentially have got well received by consumers and Indian alcobev companies are only increasing their relevance to an ever growing consumer base in India. So, I still think it is still early on. We are still very early on in terms of matrices like our per capita consumption and individual players continue to be on the journey of premiumisation which is driving their realisations, revenues, margins, cash flows. So, I still believe that the sector itself, the category itself still has many-many years to go.
