3 min read.Updated: 29 Nov 2017, 04:53 AM ISTLivemint
Higher direct tax collections could lower the tax burden on the poor by creating fiscal space for a reduction in GST rates
The second round of the great Indian tax overhaul has been flagged off. The Narendra Modi government has appointed a committee headed by Arbind Modi to review the Income Tax Act of 1961. This is a welcome move, and comes in the wake of the—admittedly rocky—transition to a new indirect tax regime with the introduction of the goods and services tax (GST). As we will explain later in this editorial, a new direct tax system could help lower GST rates in the future.