The review of GST rates and slabs is almost complete and the GST Council will soon decide whether the rates and slabs will be increased or reduced. Finance Minister Nirmala Sitharaman gave this information. According to PTI report, the council headed by Sitharaman and his state counterparts has formed a ministers (GOM) to suggest changes in GST rates as well as a reduction in slabs. Currently there are four slabs of Goods and Services Tax (GST) – 5, 12, 18 and 28 percent. Packaged foods and essential commodities fall into the lowest slab of 5 percent and luxury items come in the highest GST slab of 28 percent.
Ministers were asked to consider deeply at rates
According to the news, the Finance Minister said that by taking impartiality towards all the ministers and councils involved in GST, the work of rational and simplifying GST rates has started. In fact, it started about three years ago. Sitharaman said that later its scope was extended and now the work is almost complete. The Finance Minister said that he has asked the Council of Ministers to discuss more deeply on the rates related to everyday items used by the common people. He said that it is important to ensure that this opportunity is not missed.
The economic foundation of the country is strong.
Sitharaman said that it was also important to me not to miss the opportunity, we can also reduce the number of rates, which is also the original intention. Therefore, there is a need to work on it and I hope that the GST Council will soon decide on it. A few days after introducing the Union Budget 2025-26, in which the middle class has also been provided significant relief in income tax, the minister said that the country’s economic foundation is strong and there is no structural recession. Sitharaman said that there is no proposal to close the old tax system.
There is no reduction in capital expenditure
In response to a question related to capital expenditure, the minister further said that capital expenditure has not decreased but it has increased to Rs 11.21 lakh crore, which is 4.3 percent of GDP. The budget for the financial year 2025-26 proposes to spend Rs 11.21 lakh crore on capital expenditure (CAPEX), which was Rs 10.18 lakh crore in the revised estimate of FY 2025.
It was Rs 10 lakh crore in FY 2024, it was Rs 7.5 lakh crore in FY 2023, it was Rs 5.54 lakh crore in FY 2022 and in FY 2021 it was Rs 4.39 lakh crore. In the budget, the fiscal deficit for FY 26 was fixed at 4.4 percent of GDP and the target for FY 25 was reduced by 10 basis points to 4.8 percent of the GDP.
