There will be NO CESS under GST
- March 10, 2016
- Posted by: Indirect Tax Professionals
- Category: News
Talking to Hindustan Times, Revenue Secretary, Hasmukh Adhia said a reprieve from cesses will come through once GST kicks in. “First, cesses are for a specific purposes. Second, under the new regime of GST, there will not be any cesses,” Adhia said.
However, he did mention that the government will continue to hold power to introduce a cess during the GST regime but it will then come through only after the approval of the GST council which comprises state finance ministers as well.
Explaining the logic behind introducing two new taxes ans making an additional burden through clean energy cess. Adhia said, “Since once GST comes in there will be no cesses, this as the only year when there was a small chance of additional mobilisation of resources through taxes to raise money for specific purposes such as for farmers through the Krishi Kalyan cess, clean energy cess for environment and infrastrcture cess for building traffic – free roads and for a pollution- free environment.”
Meanwhile, he also said the tax deparment will soon come up with a study to assess the inflationary impact of the implementation of GST. It is being contemplated that once GST kicks in, for the first few years, tax payers will have to pay more, leading to an additional burden on the common man. On tax being imposed in the budget on the super rich, Adhia said the government had a choice to either increase the direct tax burden for all or for only those who can afford to pay.