Seven years on, GST still sparks Centre-state friction

New Delhi: July will mark the seven-year anniversary of the introduction of the goods and services tax (GST), one of the biggest economic reforms in India since 1991. GST brought the taxation of goods and services under a single umbrella, replacing a range of state and central taxes, many of which had been in place for decades. The aim was to create a single common market, where sellers and buyers didn’t have to worry about paying a state tax here and a municipal tax there.

Critics of the current GST setup have pointed out that the original aim of having a single rate for all goods and services was done away with. A multiple slab structure, they added, had introduced needless complexity into the system. It had introduced absurdities, where luxury items like gold and jewellery were taxed at the lowest rate, while essentials like sanitary pads were taxed much higher (though, subsequently, the government exempted sanitary pads altogether from GST).