Budget 2015: Tax tributaries flow into GST mainstream

Finance minister Jaitley's indirect tax proposals have sought to align the `Make in India' campaign and the drive to boost `ease of doing business' with the move towards the goods and services tax (GST) scheduled for an April 1, 2016 rollout. Keeping GST in mind, the FM has pruned the negative list in service tax, bringing more services under the net.And while post-GST both Centre and states will put a levy on services, Centre has already increased tax rate from 12% (excluding cess) to 14%. The combined state and central GST rate, though, could be higher when introduced.

“The government has reduced customs duty on raw materials and increased it on finished products, this is in line with the PM's call for `Make in India' and to encourage manufacturing,“ said Sumit Dutt Majumder, Central Board of Excise and Customs ex-chairman. The Centre has also cut exemptions available on levy of excise which is again in line with GST.

But the FM has failed to rejig the threshold limit for taxing small businesses.Under service tax, it remains at Rs 10 lakh (per annum) and Rs 1.5 crore for excise duty