Hong Kong, Sep 21 (IANS) Indian Finance Minister Arun Jaitley on Monday expressed his confidence that the new goods and services tax (GST) regime will roll out from next fiscal despite the pending issues regarding direct tax.
“The Congress is trying to delay the new tax regime. But one must remember, it is a transactional tax and not an income tax,” he said here at a press meet in the second leg of his four-day official tour to Singapore and Hong Kong.
He expressed his confidence that the GST will be passed in the Rajya Sabha in the next session.
Jaitley, however, added it was not necessary to implement the new regime from April 1, 2016, itself and since it is a transactional tax, it can come into effect from the first date of any other month.
“It (GST) can come up on the first of any month. Delay from April 1 does not mean that it will go to April 1 of the next year. That only happens in income tax,” he added.
About the retrospective tax and minimum alternate tax (MAT) issues in India, Jaitley said: “For the future, retrospective tax and MAT are over. Transfer pricing has been resolved. It is not that we have been only talking about these things, we have been acting on it as well.”
He also said all macroeconomic parameters including fiscal deficit and inflation are in the positive territory and expected that GDP growth would outperform 7.3 percent rate of last year.
“We grew by 7.3 percent last year and I hope that we are able to outperform our last year’s growth numbers,” he said at the inaugural APIC-India Capital Markets and Institutional Investors Summit.
Regarding the impact of Chinese economic slowdown, the finance minister said it will affect the stock markets.
“Any change in Chinese currency will impact the currency market.”
He also added that Chinese investments in India are very much welcome.
The minister said the high cost of capital was affecting several sectors and domestic private sector investments have been slow.
“The cost of capital is still high. Therefore, it is impacting infrastructure and manufacturing. Its impact on real estate sector which is an important growth engine in India is itself being felt,” he said.
Asked about his expectations from the apex bank – the Reserve Bank of India – on its next monetary policy move, he said: “Let us leave it to RBI.”
Jaitley, whose tour is intended to attract investors to the country, said that to expedite dispute settlement, the government has readied a new law to ensure disputes are settled through arbitration in six months.
Talking about India’s ranking in the World Bank’s ease of doing business, which was 140th position last year, he said it will improve in the future.”Ease of doing business is still a work in process. A lot will have to be done.. off course on a continuous basis,” he asserted.