"As
I have mentioned elsewhere, it has been estimated that
the GST implementation increased Canadian GDP by 1.4 per
cent. In India, we can expect a similar kind of positive
impact. This means gains of about $15 billion
annually," Thirteenth Finance Commission Chairman
Vijay Kelkar said at a seminar on GST organised by
Assocham here.
A
study on the impact of GST on foreign trade indicates
that the rate of growth of exports will be significantly
higher than that for imports. GST will also promote
employment, Kelkar said.
The
GST regime, he said, will lower the tax rate by
broadening the tax base and mimimize exemptions. It will
also reduce distortions by switching to the destination
principle of taxation and reduce compliance costs, he
said.
Infact,
he suggested, that to broaden the GST tax base
activities like housing, construction and railways
should be included in GST.
The
government is readying a roadmap for implementation of
GST by April 1, 2010.
However,
with no consensus on the rates of GST and the structure,
there is agreement on dual tax structure and the states
would be compensated for any revenue loss arising out of
GST implementation.
