New Delhi, Dec 2 (PTI) About 70-75 per cent of GST revenues collected in 2023-24 fiscal year came from the 18 per cent slab, while just 5-6 per cent came from the 12 per cent bracket, Parliament was informed on Monday.
Only 6-8 per cent of the FY24 goods and services tax (GST) revenues were from the 5 per cent slab, while the highest tax slab of 28 per cent contributed 13-15 per cent to the revenues in the last fiscal year.
Minister of State for Finance Pankaj Chuadhary shared the details of the proportion of GST collected (excluding compensation cess and other payments) under various tax slabs in 2023-24 in the Lok Sabha.
The GST Council has constituted a six-member Group of Ministers (GoM), under Bihar Deputy Chief Minister Samrat Chaudhary, to suggest rationalisation of GST rates as well as merger of slabs to increase GST revenues.
Currently, GST is a four-tier tax structure with slabs at 5, 12, 18, and 28 per cent.
Under GST, essential items are either exempted or taxed at the lowest slab, while luxury and demerit items attract the highest slab. Luxury and sin goods attract cess on top of the highest 28 per cent slab.
The average GST rate has fallen below the revenue neutral rate of 15.3 per cent, prompting the need to start discussions on GST rate rationalisation.
The committee headed by former chief economic advisor Arvind Subramanian on possible tax rates under GST was of the view that the Revenue Neutral Rate (RNR) should be between 15 and 15.5 per cent.
Based on current data of GST returns as available with Goods and Service Tax Network, the average GST rate for 2023-24 was 11.64 per cent, Finance Minister Nirmala Sitharaman said in reply to a separate question in the Lok Sabha.
To a question on whether there exists bitterness and friction between the Centre and the states on the GST arising out of the share to states, Sitharaman said, "There is no bitterness between Centre and states on GST. GST shares to states are settled on a regular basis as provided under the GST law."