India’s implementation of the “complex” Goods and Services Tax (GST) could be studied by US business schools, Prime Minister Narendra Modi has said, as he invited top American companies to invest in the country which has initiated major reforms.
“The implementation of the landmark initiative of GST could be a subject of studies in US business schools,” Modi said on Sunday while interacting with 20 top American CEOs at a roundtable in Washington ahead of his first meeting with US President Donald Trump.
On GST, the Prime Minister said that this is becoming a reality after years of effort, ahead of the roll out of the landmark tax reform measure from July 1.
He added that its implementation is a “complex” task and went on to suggest that this could be the subject of future case-studies.
Implementation of the GST shows India can take big decisions and implement them swiftly, the Prime Minister said at the interaction with the group of CEOs that included Tim Cook of Apple, Sunder Pichai from Google, John Chambers from Cisco and Jeff Bezos of Amazon.
Modi told them that his government was working on principles such as Minimum Government, Maximum Governance.
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The Prime Minister spoke of the recent reforms, and noted that the Union government alone has initiated 7,000 reforms. He said this indicates India’s quest for global benchmarks. He mentioned the government’s emphasis on efficiency, transparency, growth and benefit for all.
Pichai told reporters after the meeting that American businesses were excited about investing in India.
Praising the steps being taken by the Indian government in the last three years, he said the US companies are looking forward to the roll out of the GST.
“Good,” said Cook as he emerged out of the meeting.
The US-India Business Council (USIBC) president Mukesh Aghi said the CEOs praised the reforms being undertaken by the Prime Minister and underscore his efforts to make India a business-friendly destination.
Prime Minister Modi also said that if America becomes stronger, India will be a natural beneficiary. He also added that India believes that a strong America is good for the world.
He sought enhanced attention from the CEOs in areas such as women empowerment, renewable energy, startups and innovation. He suggested linking sanitary practices, products and technologies with the requirements of school going girls.
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He reiterated that his primary interest is improving the quality of life in India.
Touted as the biggest taxation reform since Independence, GST will unify 16 different taxes including excise, service tax and VAT, and transform India into a single market for seamless movement of goods and services.
The powerful GST Council, comprising Centre and states, has recommended a four-tier tax structure – 5, 12, 18 and 28 per cent. On top of the highest slab, a cess will be imposed on luxury and demerit goods to compensate the states for revenue loss in the first five years of GST implementation.
GST rates would depend upon whether the commodity is used by a rich person or a common man.
State and Union Territory GST laws were passed by all the states and Union Territories of India except Jammu & Kashmir, paving the way for smooth roll out of the tax from July 1.