While PM Narendra Modi says GST will lead to lower prices, Congress vice president Rahul Gandhi calls the tax reform 'badly conceptualized and implemented'
New Delhi: Prime Minister Narendra Modi on Thursday held out the promise of a consumer protection law and said the goods and services tax (GST) would eventually lead to lower prices, benefiting the poor and the middle class.
The Prime Minister’s remarks came on a day when Congress vice-president Rahul Gandhi stepped up his attack on Modi over GST, which, he said, had been “badly conceptualized and implemented."
Modi said at a conference in the capital that the new law will empower consumers. A Central Consumer Protection Authority with executive powers will be set up for quick remedial action under the new Consumer Protection Act.
“Rules are being simplified to ensure that consumer grievances are redressed in a time-bound manner and at the least possible cost," he said, adding that stringent provisions are proposed against misleading advertisements.
Modi said that with GST’s rollout on 1 July, many hidden taxes had been done away with. “Now, the consumer knows how much tax he has paid to the state government and how much to the central government," he said. The PM added that increased competition due to GST will lead to moderation in prices. “It will directly benefit the poor and middle class consumers," he said.
GST has become a bone of contention between Gandhi’s Congress party and Modi’s Bharatiya Janata Party (BJP) in the run-up to the December assembly election in Gujarat, the Prime Minister’s home state. GST is a sensitive issue in Gujarat, whose labour-intensive diamond and textile industries staged protests against some of the provisions of the new tax regime, including the tax rates.
Targeting the government and Modi, Gandhi said on Thursday that three years ago, the people of India had reposed faith in Modi when they voted his party to power. The expectations with which they had voted for the BJP-led National Democratic Alliance now lie shattered, he said.
At the valedictory session of the PHD Chamber of Commerce and Industry, Gandhi accused the Modi government of striking twin blows “at the heart of our economy, first demonetisation and then a badly conceptualized and implemented GST." He called the situation MMD, or Modi-Made Disaster.
Gandhi said the Prime Minister had failed to grasp a basic concept of the Indian economy—that all cash is not black and all black is not cash. “In a couple of weeks from now, we will observe the death anniversary of the 500 and 1,000 rupee notes when Narendra Modi wiped out 86% of the currency in circulation overnight. It was a move taken without thought, without consultation or concern for its consequences," he said.
“Business thrives with trust. And the truth is, trust in this government is dead. For some reason, the PM and his government are absolutely convinced that every single person in India is a thief," he said.
He said that demonetisation had crippled small and medium enterprises and had destroyed the unorganized sector, and described GST as flawed. “This GST is a 21st century computerized and connected License Raj. It is flawed in its structure and is forcing businesses to incur massive transaction costs that are destroying them," he said.
Gandhi said the government had been unable to create jobs in the economy and said the unemployment situation was extremely worrying. “The government is creating a massive army of unemployed youth, which is toxic and dangerous," he said.