Despite of all the efforts ministry is taking in the form of multiple rates , exemptions , extension of levy of interest on late filing of returns etc. ,tax collection has been below the expectation level .
GST collections were 5.8% of GDP, which was better than some of the comparable developing countries, but far below the potential of 8.2% of GDP, indicating that the efficiency gains from the new regime have not fully accrued.
While Exemptions are for the benefit of the people , exemption for food products are estimated to cost up to 0.4% of GDP to ministry . Rather , it has been pointed out by the committee of Indian government officers that exemptions available to food products were being misused and some well known brands have even de-registered themselves in order to avoid taxes. Multiple rate is also one of the reason considered as creating confusion among the taxpayer and delay in payment of taxes.
There are rates dedicated for the things people use on a daily basis while sin and luxury goods are under the highest rate slabs . Now after collecting lower tax payments than expected ,the government is seeking to plug leakage and also fix some technical issues .