Former finance minister P Chidambaram today responded to Prime Minister Narendra Modi for criticising the Congress party after it demanded an 18-per cent cap on GST rates, saying whether the government’s Chief Economic Adviser (CEA) was “stupid” for having a similar view. “If it is Grand Stupid Thought to argue for a cap of the tax rate at 18%, then CEA Dr Arvind Subramanian and many other economists are stupid. Is that what PM is saying?” Chidambaram said in a series of tweets. Modi, who addressed four back-to-back election rallies in Gujarat yesterday, targeted Congress vice-president Rahul Gandhi over his remarks on the Goods and Services Tax (GST).
In a rebuttal to Gandhi’s repeated criticism of the GST, a key economic reform undertaken by the NDA government, Modi said a “recently emerged economist” was propagating a “grand stupid thought” by suggesting a uniform GST rate of 18 per cent. Chidambaram responded to the criticism saying: “Has PM read the CEA’s report on Revenue Neutral Rate? Did not CEA recommend an RNR of 15-15.5%? Why can’t the normal GST rate be 15% and RNR plus rate on luxury goods be 18%?” he asked.
The senior Congress leader said tax and spend is the “credo” of the BJP government. “Example: when crude oil prices fell by 50 per cent, prices of petrol and diesel remained the same.” Chidambaram said 5,000MW of stressed power assets, no tender for power purchase, and no demand for power. Yet, the government claims that “all is well with economy!”