GST rate cut to boost demand may be counterproductive, say finance ministry officials

The government may not accept the industry’s demand to substantially reduce Goods and Services Taxes (GST) for six months to boost demand as the exemption would block input-tax credit that would have an adverse impact on businesses and may not result into any significant gain to the consumer, two finance ministry officials said. The GST exemption will make output tax as zero and thus the input-tax…