NEW DELHI: The GST roll out will prove to be a revolutionary step and has potential to transform the “fiscal architecture” of the government, Minister of State for Finance Jayant Sinha said today.
“In some ways it is as revolutionary and as profound as what happened in 1991 because it is changing fundamentally the manner in which the Indian government functions,” Sinha said in a television channel program.
GST will “fundamentally change the taxing power of the states, local governments and the Centre”, and through the devolution to the states, it will transform the “fiscal architecture” of the Indian government, Sinha added.
The 14th Finance Commission has recommended higher share to the states in central taxes. It suggested to increase shares of states to 42 per cent from current 32 per cent.
As per the increased devolution, states will get Rs 3.48 lakh crore in 2014-15 and Rs 5.26 lakh crore in 2015-16.
GST will put in place a state-of-the-art indirect tax system from next fiscal, aiming to create a single tax for goods and services across the country.
Source: THE ECONOMIC TIMES