Chennai: President Pranab Mukherjee on Saturday hoped the central government would set up the Goods and Services Tax (GST) Council to fix the tax rate while praising former RBI Governor Raghuram Rajan for taking steps to solve the situation in the banking sector.
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Speaking at the centenary celebrations of Karur Vysya Bank Ltd, Mukherjee said the GST Bill has been passed and it has been ratified by 20 states qualifying for the Presidential asset.
Hoping the Union Finance Ministry will take appropriate steps to set up the GST Council to fix the tax rate, he pointed out that it is GST Council’s responsibility to have one uniform rate of GST tax to be introduced all over India.
It will not only be one uniform rate of taxes, but it will also be single point taxation and not multi-point taxation and therefore the cascading effect of that will not be very serious, Mukherjee said.
He told the bankers present at the meeting that they are trustees of depositors’ money and urged them to be prudent about non-performing assets (NPA).
He it is their sacred responsibility to protect the money of those who have reposed trust in them.
Mukherjee said a growing economy like India needs credit expansion but the provisions for NPA has reduced the resources for credit disbursement by commercial banks leading to an undesirable situation.
He pointed out that stressed advances to gross advances of scheduled commercial banks have increased from 10.9 per cent in March 2015 to 11.4 per cent in March 2016.
According to Mukherjee, who was Union Finance Minister before he became president, the aggregate provisions made by all scheduled commercial banks have consequently increased from Rs 73,887 crore for the year March 2015 to Rs 170,630 crore for the year ending March 2016.
However he said former Reserve Bank of India (RBI) Governor Rajan took many appropriate steps to put the system in the right direction.