“Several products are set to be out of GST base and that implies a portion of our GDP will not generate input tax credit. So significant cascading of taxes is likely to continue,” Parthasarathi Shome said on the sidelines of an interactive session on GST at Merchants’ Chamber of Commerce & Industry.
Petroleum, electricity and several services expected to be out of GST and will allow continuation of cascading effects on tax partly preventing getting price benefit on final products, he said.
To explain, businesses or industry using petroleum, electricity and real estate will not be given input tax credit since out of GST, he pointed.
Cess remains a ‘grey’ area whether input credit will be available or not, Shome highlighted.
Shome was also critical about not offering more ti
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