GST reforms to boost Bengal's economy, says Sitharaman

Kolkata, Sep 18 (PTI) Union Finance Minister Nirmala Sitharaman on Thursday outlined the key features of the Next Gen GST reforms, emphasising that the new tax structure will benefit the people of India, particularly the poor, middle class, farmers, MSMEs, and several key industries in West Bengal.

Sitharaman said that the new GST rates would be implemented from September 22, in time for the Durga Puja which is the biggest festival of the state.

Addressing a GST-related discussion at the National Library's Language Building in Kolkata, she said that the reforms are a comprehensive effort to reduce tax rates, ease compliance, and clear business confusions.

"The New Generation GST is not only about reducing rates, but also about simplifying compliance processes and providing clarity for businesses. These reforms were designed with five key parameters in mind: to help the poor and middle class, support farmers, assist MSMEs, and to drive growth in sectors crucial for the economy," Sitharaman said.

She added that the review of the GST was a result of extensive consultations and efforts from all states, with significant contributions from the GST Council.

"But I would be amiss if I did not give credit to the states for coming together and agreeing on the proposal in the GST Council to reduce the rates. I wrote personalised letters to the finance ministers in the GST Council, irrespective of party or affiliation, thanking them for playing a very constructive role, as the people of India need this reduction now," she said.

“I am happy to say that the determination of September 22 as the implementation date for Next Gen GST was largely influenced by Puja. The Shubh Mangal Diwas when the revamped GST comes into effect coincides with the first day of Navratri, the day after Mahalaya. There is, therefore, a strong influence of Bengal in this decision-making,” she said.

The message from Bengal will go on to inspire the rest of the country, just as it did during the independence struggle and as Bengal has always done in leading the nation, Sitharaman said.

"Durga Puja is Bengal's biggest festival, and people in the state make major purchases during this period. Keeping this in mind, we have chosen this date for the new GST rates to come into effect. This will allow people to benefit from the reduced tax burden during the festive season," she said.

The finance minister also explained that the implementation of the Next Gen GST had been delayed by a few days due to the ‘Pitri Paksha’ period, but the decision to roll it out just before Durga Puja had been made to ensure the maximum benefit for the people.

Explaining how the Next Gen GST will benefit various industries in Bengal, Sitharaman said, "Several industries in Bengal, especially in the handicraft and small-scale sectors, will see a reduction in tax rates. The new framework will help local industries." She noted that the new GST structure would bring down taxes on essential goods and promote local craftsmanship.

Sitharaman also pointed out that products like ‘Nakshi Kantha’ (embroidered clothes), Malda's mangoes, Darjeeling tea, jute bags, hosiery, and ready-made garments would directly benefit from the new reforms.

The finance minister expressed optimism that these changes would spur growth across various sectors in the state.

"From small-scale industries to agricultural products, the new GST framework will open up new opportunities in the market, which will also help the state's economy," she said.

"Bengal is known for its rich craftsmanship and agricultural products, and with the new tax rates, we expect increased sales during the festive season," she said.

Announcing the outcome of the 56th GST Council meeting on September 3, Sitharaman on Wednesday evening said that all individual life insurance policies, whether term life, ULIP or endowment policies and subsequent reinsurance are exempt from GST.

The GST Council approved limiting slabs to 5 per cent and 18 per cent, effective from September 22, the first day of Navaratri. PTI BSM PNT NN