Union Finance Minister Piyush Goyal has said that rising tax collections will further help reduce the tariffs, couple of days after goods and services tax (GST) rates were cut on 100 items. Besides, he underlined the Directorate General of Anti-Profiteering has been directed to keep a tab on manufacturers of sanitary napkins, so that benefits of the GST rate cut are passed on to consumers. The GST Council had exempted sanitary napkins from GST.
There have been reports that sanitary napkins will not benefit from the exemption from GST since they will not be able to claim credit on raw materials used in manufacturing. Terming these reports as ‘misplaced calculation’, the Minister said ‘I have already instructed the department, which looks after anti-profiteering, to investigate and ensure that either the rates should have had come down on July 1, 2017, or should come down now. It cannot be that they have the cake and eat it too’. Moreover, for the current financial year (FY19) the government’s target of Rs 1 trillion a month, is still not a norm.
The Council had cut rates on almost 100 items. Of these, 18-20 items saw the rate coming down from the highest slab of 28%, leaving just 35 items, including ACs, digital cameras, video recorders, dishwashing machines and automobiles, in the highest tax bracket. GST collections have been on the rise since the end of financial year 2018. It touched slightly over Rs 1 trillion in April, but that was an aberration. After that, collections came down to Rs 94016 crore in May and Rs 95610 crore in June, which were still higher than the average monthly collections of Rs 89885 crore in FY18.