New Delhi, Aug 16 (UNI) In a renewed push for a comprehensive tax reform, the Congress today reiterated its demand for a complete overhaul of the Goods and Services Tax (GST) regime, calling for a “radically transformed GST 2.0.”
Congress has also demanded that the Union government release an official discussion paper on the subject soon to enable a wider and informed national debate.
The party emphasised that such a transformation is critical for reviving economic growth, spurring private consumption, and boosting investment.
Senior Congress leader Jairam Ramesh in a statement said, “For well over a year and a half at least, Congress has been calling for a radically transformed GST 2.0. This was a key pledge in its manifesto for the 2024 Lok Sabha elections”.
He criticised the current structure of GST, calling it “a Growth Suppressing Tax” due to its complex rate structure, multiple exemptions, and procedural hurdles that have hampered compliance and encouraged tax evasion.
“The spirit of GST has been vitiated by an increased number of rates and the granting of multiple exemptions. The structure also seems to have facilitated evasion. There must be a drastic reduction in the number of rates,” Ramesh said.
Calling for a drastic reduction in the number of tax rates and a simplified structure, Ramesh said, “Simplification of the rate structure is essential but must be done in a manner that minimizes revenue uncertainty to states and also eliminates the classification disputes that have become so common.
The GST compensation cess expires on March 31, 2026. This must be extended to offset any revenue uncertainty from the rationalization of the rate structure”.
Addressing the concerns of Micro, Small and Medium Enterprises (MSMEs), Ramesh underlined the need for meaningful procedural reforms and higher exemption thresholds for interstate supplies. “The widespread concerns of MSMEs — major employment generators in the economy — must be addressed meaningfully. Apart from major procedural changes, this will involve further increasing the thresholds that must apply to interstate supplies as well”.
The Congress leader also flagged sector-specific issues affecting textiles, tourism, handicrafts, agricultural inputs, and exporters.
“In addition, states should be incentivized to move towards the introduction of state-level GST to cover electricity, alcohol, petroleum, and real estate as well,” Jairam suggested.
“The Congress demands an official discussion paper on GST 2.0 very soon so that there can be an informed and wider debate on this vital and pressing national issue. GST 2.0 should be truly a Good and Simple Tax (GST) in letter, spirit, and compliance – not like the Growth Suppressing Tax (GST) it has become,” the Rajya Sabha MP said.
