Indian ministers have decided upon rates for “substantial items” as the government prepares to launch the new goods and services tax on July 1st.
Editor’s Remarks: The GST is the largest tax reform in India’s modern history, and its implementation will create a common market of 1.3bn people – almost double the population of the EU. Finance Minister Arun Jaitley insists the GST’s “impact is not inflationary”. Details seem to support this; there have been no tax increases on any commodity, numerous reductions, and the removal of the “tax on tax”. Presently, the government has decided on rates for 1211 categories of item and is yet to make a decision on six types of branded food. The GST will simplify India’s draconian tax laws, which currently vary enormously from state to state. Downing Street will be watching intently as the UK continues to publicly announce its ambitions for a trade deal with Modi’s India.