NCP (SP) MP Supriya Sule. File
| Photo Credit: PTI

Ahead of the 54th GST Council meeting on Monday (September 9, 2024), NCP (SP) MP Supriya Sule has called for urgent action on various issues related to GST rates, including the need to rationalise taxes on essential goods and services, particularly in the sectors of food, healthcare, education, and renewables, amidst rising unemployment, food inflation, and a slowing GDP growth rate.

“Given the current economic climate, it is essential that the government eases the financial burden on our citizens by rationalising taxes on important goods and services,” she said.

Speaking to The Hindu, Ms. Sule targeted her cousin, Maharashtra’s finance minister, Ajit Pawar, over his repeated absence from previous GST Council meetings.

“As the sole representative of Maharashtra’s 13 crore citizens, the finance minister’s absence has left the State without a voice on crucial GST-related decisions,” she said, urging Mr. Pawar to attend the meeting to advocate for State’s interests.

Focusing on the soaring food inflation, she reiterated her demand for the removal of GST on essential commodities like pulses, cereals, and dairy products. She called the 12% GST on dairy items such as butter and ghee “unacceptable.” “The 12% GST rate on butter, ghee, and other dairy products is simply unacceptable,” the four-time MP from Pune’s Baramati said.

Agriculture, another critical area, saw a mere 2% growth in the first quarter of 2024, she said. “This is not a temporary dip; agriculture has been in a long-term slump for the past decade. High GST rates on essential agricultural products, such as fertilisers and machinery, have exacerbated the distress in the sector. If we are to revive agriculture in India, there must be 0% GST on the entire sector,” Ms. Sule, daughter of NCP (SP) supremo Sharad Pawar, and the party’s national working president, said.

She urged Union Finance Minister Nirmala Sitharaman to also reduce GST rates on healthcare products and services, particularly for senior citizens. “India’s out-of-pocket health expenditure continues to hover around 50%, a staggeringly high figure compared to the global average of 17.05%. The government must work to ease this burden of healthcare costs on our citizens by reducing the high GST rates on various healthcare products and services, particularly for senior citizens,” she said.

The 18% GST on medical insurance is disproportionately impacting senior citizens, she said, quoting Union Minister Nitin Gadkari’s statement that it “amounts to taxing individuals seeking cover against life’s uncertainties.”

Ms. Sule urged the government to lower the GST on medical insurance for senior citizens from 18% to 12%, as recommended by the Standing Committee on Finance in February.

If the Insurance Regulatory and Development Authority of India’s target of ‘Insurance for All by 2047’ is to be met, it is imperative that the government reduce the GST rate on medical insurance for senior citizens from 18% to 12%, she said.

The Baramati MP also called for life-saving drugs and medical equipment to be exempted from GST, arguing that it would “provide great relief to patients and incentivize domestic production.”

She further criticised the imposition of 18% GST on private schools, higher education institutes, and EdTech platforms, stating that it places a significant financial burden on parents. “The government should lower the GST on these products to make education more affordable,” she added.

Speaking about the issue of consumer demand, she said the government should cut down the GST on essential appliances from 12% to 5% and on aspirational appliances from 28% to 18%. She also called for a rationalisation of GST on electric vehicles and related technologies to promote investment in battery-swapping infrastructure. “There is disparity in GST rates for EVs with and without batteries, and for lithium-ion batteries sold separately. This difference in GST rates disincentives investment in battery-swapping technology.”

She also said there is need to support handloom weavers, whose livelihoods were severely impacted by the COVID-19 pandemic. “Handloom clothes and raw materials must be exempted from GST to alleviate their financial distress,” she said, adding that with the current political landscape, there should be no obstruction in implementing these changes, except a lack of will.