Reserve Bank of India governor Urjit Patel today said that the soon-to-be implemented Goods and Services Tax (GST) will not only create a national market but will also broaden the tax base, which in turn will lower the overall taxes in the long-term.
Addressing an event organized by IMC Chamber of Commerce and Industry in Mumbai today, Patel said that GST itself is part of the digitisation revolution, which along with the reforms on the information tax side in terms of the processes and operations, have the potential to broaden the tax base considerably. The governor also said GST is a precursor to a low tax regime in the country at a later stage.
He also said that the broadening of tax base is an important outcome of the new uniform taxation regime and other initiatives on e-payments and digitisation. He added that besides creation of a national market, GST will also reduce many inefficiencies within the states while moving goods from within a state and also across the country