Mitra said SMEs feed large industries and that this is the most labour-intensive sector and, therefore, SMEs should be given simpler passage for doing business. The single tax structure of GST would be the ideal platform for them, he said. “SMEs will benefit the most from single tax system,” said Mitra, who is also the head of the Empowered Committee of State Finance Ministers.
Mitra said to make life easier for SMEs, dual control of the Centre and states have been done away with for entities with an annual turnover less than Rs 1.5 crore. A constitutional amendment bill preparing the ground for the GST was passed in the Rajya Sabha.
The proposed legislation seeks to create uniformity in taxes across states, increasing efficiency and compliance, and also boost the Narendra Modi-led government’s agenda of ensuring ease of doing business.
Mitra also said the GST rate should be such that it should positively impact the common people by way of reducing prices. The contentious revenue neutral rate would be decided later by the GST Council once a general principle is agreed to. He said the rate should not be too high, otherwise it would lead to high prices, and not too low either, so that state government’s revenue is protected.
Source: The Economic Times