India’s GST must restore the free flow of credit

India's GST has the outward form of a value-added tax — the invoice, the credit ledger and the promise of a seamless national market. What it lacks is the function that makes a VAT a VAT: the free circulation of input tax credit. That is not a technical quibble. Credit is to a value-added tax what blood is to the body. So long as it flows, the tax falls only on the value added at each stage and co…