New Delhi, Aug 2 (FN Bureau) Stating that government was monitoring price trends closely and had its ears to the ground, Finance Minister Nirmala Sitharaman on Tuesday reiterated that Indian economy is much better placed and all the macroeconomic fundamentals remain strong. “Indian economy compared to the situation prevailing in many of our peer groups and compared to the situation in many of the developed economies is definitely much better,” she said while replying to the discussion on price rise in the Rajya Sabha.
She mentioned about loans being sought by neighbouring countries of Sri Lanka, Bangladesh and Pakistan from the International Monetary fund (IMF) to convey that India is strong and stable despite several challenges like pandemic, Russia-Ukraine war and volatility in international commodity markets. She said that nobody was in denial about price rise in the wake of geo-political crisis and other adverse economic situations globally. “We are looking at number as well as situation on the ground. Constantly we are getting input from people affected and based on that we are having a targeted approach,” the Finance Minister said referring to suggestion by Samajwadi Party MP Ram Gopal Yadav that government should be in touch with the poor and vulnerable, besides talking about inflation data. Participating in discussion on price rise in Rajya Sabha, Samajwadi Party MP Ram Gopal Yadav also urged the Finance Minister to withdraw GST on food items.
Sitharaman, however, said that the decision to levy 5% GST on various pre-packaged and branded food items only after the all-powerful GST Council had approved it. She took on the opposition parties head on and said that finance ministers of all states are part of the GST Council and the proposal was approved after a three-tier process which included a fitment committee comprising of officers, group of ministers (GoM) and then finally the Council. The Minister said that it’s a matter of record that all states agreed to the proposal in the 47th GST Council meeting which was held in Chandigarh. “I put it on record. The oral recording, the minutes stand testimony that there was not one person who spoke against it,” Sitharaman said. In her reply, the Minister compared tax rates in pre-GST and post-GST regimes on various key household items and noted that the present GST rates were lower. She said that government had kept prices of tomato, potato and onions in check. As she defended the GST Council decision to levy 5% GST on various pre-packaged and labelled food items such as curd, paneer, rice, flour, milk etc, she said that these items when sold loose will not be taxed. She also said that states earlier levied tax on some food item or the other.
The Minister said that she was concerned that probably right information was not reaching (to people) and as a result there is quite a lot of misconception. Sitharaman stated that there was no GST on crematorium and that tax was being levied only on construction of new crematorium. She also clarified that no GST had been levied on ICU and tax had been imposed on hospital rooms with a rental of Rs 5,000 a day. As the Minister was replying to the short-duration discussion, TMC MPs staged a walkout from the House protesting against the decision of the Chair to disallow their leader Derek O’Brien was disallowed from raising a point of order.