New Delhi [India], October 2:I am not an economist, and my understanding of finance is no deeper than that of an ordinary citizen. My late father served as the Minister of State for Finance in the Government of India. During those years of economic reforms, I was too young to inherit his expertise, but I did grow up hearing stories of liberalisation and globalisation that transformed India's economy.
When Shri Narendra Modi became Prime Minister in 2014, one of the toughest challenges on the path of reform was to bring uniformity to India's complex tax system. On 1st July 2017, the country witnessed a historic change with the launch of the Goods and Services Tax (GST)—a single, unified system that replaced 17 different taxes, such as excise duty, service tax, sales tax, and octroi.
Until then, understanding taxes was difficult not only for businesses but also for consumers. The implementation of GST sparked debates both inside and outside Parliament, yet despite differing opinions, consensus emerged, and the reform was accepted across all states. The GST Council was established with representation from every state, and revenue was shared equally between the Centre and States. Importantly, the initial GST rates were kept roughly at the same level that consumers were already paying under the earlier system of multiple taxes.
The results were transformative. GST simplified taxation, curbed revenue leakage, and significantly boosted both central and state government collections. With growth consistently above 7%, India has emerged as the world's fourth-largest economy and is now on the verge of becoming the third. The Prime Minister has set the ambitious target of making India a 5 trillion economy.
In her recent address, Finance Minister Nirmala Sitharaman announced revisions to GST rates during the 56th meeting of the Council. According to the government's vision, most goods and services will now fall under the 5% and 18% slabs, while luxury and harmful items like pan masala and cigarettes will attract a steep 40% tax. At the same time, the Centre is mindful of state finances and is ensuring that its economic stability is not compromised. With faster cash flow expected, production is likely to receive a strong boost.
The Modi government has shown courage and clarity in pursuing policies that safeguard national interest. India is not bound by any foreign pressure or restrictions. Instead, the government emphasizes self-reliance and economic sovereignty. “Make in India” is not just a slogan—it is a symbol of our national pride.
The reforms in GST represent a revolutionary step in India's economic journey. Markets are already brimming with festive energy, and citizens are witnessing a tax system that is simpler, fairer, and future-oriented. Such bold moves in indirect taxation are rare in the post-independence era. Today, we are all participants in building a stronger, more resilient Indian economy.
These tax reforms will prove to be a milestone in harnessing our demographic strength and placing India at the forefront of global manufacturing and growth.
(The author is a Member of Parliament from the Bharatiya Janata Party. Views expressed are personal.)
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