Raghuram Rajan optimistic thinking, opportunities for compromise that will help realize the goals of GST

Dated 8th December, 2015

From Lalit K Jha Washington, Dec 8 (PTI) Optimistic about the passage of long pending GST bill in the Parliament, RBI Governor Raghuram Rajan has told American investors that continued focus on fiscal consolidation and inflation will mean they will reach their targeted goal.

In an interaction with American financial institutional investors in New York last week at an event organised by US India Business Council, Rajan said another priority of the RBI is to clean up banks and their non-performing assets.

Rajan said RBI's continued focus on fiscal consolidation and inflation will mean that they will reach their targeted goals, according to a USIBC media statement.

Another priority is to clean up banks and their non-performing assets, he said.

Intention is to give banks more powers to allow for greater recovery of money and give relevant stakeholders an active role in the resolution process, he observed.

During the interaction, Rajan said he is optimistic about the passage of goods and services tax (GST) and the opportunities for compromise that will help realize the goals of the GST – a unified tax market, improvement in tax collection and broadening the tax base, USIBC said.

Under this major reform, central and state taxes will get subsumed into GST, which will reduce the multiplicity of taxes, and thus bring down the compliance cost.

With GST, the burden of Central Sales Tax (CST) will also be phased out.