Goods and Services Tax (GST) in India is a landmark reform that continues to evolve in design and impact. A VAT-based system, GST relies on value addition, input tax credits, and destination-based taxation, but its structure has been marked by multiple rates, widespread exemptions, blocked credits, and complex compliance rules that diluted neutrality and efficiency. The September 2025 reforms sought to simplify the structure by moving to a reduced number of rates, expanding digital compliance, and rationalizing refunds. At the same time, restrictions on input tax credit for goods and services at the 5 percent rate, including capital goods, risk reintroducing cascading and sectoral distortions. These changes raise important questions for revenue buoyancy, equity, and competitiveness. The session examines India’s GST journey, evaluates the new reforms, and explores pathways to a simpler, more balanced, and revenue-productive regime.

About the speaker: Arbind Modi is a globally recognized tax policy expert with over 40 years of cross-country experience in tax reform, revenue strategy, and institutional development. He has served as a short-term expert for the IMF and World Bank, advising several countries across Asia and Africa on comprehensive tax policy and administration reforms. In India, he held senior leadership roles in the Income Tax Department, including Member (Legislation) of the Central Board of Direct Taxes, Convener of the Task Force to rewrite the Income Tax Act, and Chairman of the Task Force on Goods and Services Tax set-up by the Thirteenth Finance Commission. He played a pivotal role in designing the Direct Taxes Code and India’s Goods and Services Tax (GST). At the IMF, he led multiple missions on tax diagnostics, microsimulation modeling, and revenue forecasting. He also established the Tax Policy Research Unit in India and served as Regional Tax Adviser at International Finance Corporation. A postgraduate in Economics from Delhi University, Harvard-trained MPA and international tax expert, Mr. Modi blends his technical depth, legislative experience, institutional leadership, international advisory roles, and practical reform experience to advise several developing and middle-income economies on reforming their tax systems.