Cruel to raise taxes when CPI inflation is over 7%: Jairam Ramesh

The Congress on Wednesday denounced Finance Minister Nirmala Sitharaman for defending the hike in GST rates and questioned the timing saying its "cruel" to hike the rates when CPI is over 7 per cent.

Jairam Ramesh, Congress General Secretary said: "It is cruel to raise tax rates when CPI inflation is over 7 per cent, WPI inflation is over 15 per cent, unemployment is high, the rupee is depreciating, the current account deficit is widening and inflation is expected to rise world-wide."

He said: "Branded & labelled is very different from pre-packaged & labelled. The former affects only products of big companies priced higher and bought by middle and upper middle classes. The latter affects small businesses whose products are bought by the lower middle class and the poor.

West Bengal Finance Minister Chandrima Bhattacharya minister who attended the meeting said that it was virtual. The finance ministers did not meet face to face and did not consult each other. She also contradicted the finance minister and said that she (and some others) opposed the report of the Fitment Committee that recommended the increases, the veteran leader said.

Changing its stance, the Government and the Finance Minister are now using the word "consensus" and not "unanimous," he alleged.

"Why should not the poorer consumers aspire to buy pre-packaged and labelled goods? " Jairam Ramesh wondered.

"The Modi government is penalising aspiration and a desire to buy more hygienically packed goods go through the list. The GST on crematoriums has been increased to 18%!"

Assume there are some input taxes in pre-packaged goods. Was there a demand from producers and sellers to impose a GST on pre-packaged and labelled goods? Not to our knowledge, he asked.

"Why are small businesses, shopkeepers and consumers -- all stakeholders complaining about the revised GST rates?" he questioned.