IMF Chief impressed with GST and bankruptcy code reforms

The Dollar Business Bureau 

Christine Lagarde, the current IMF chief appreciated the GST policy, labelling it as an "act of courage" while admitting that she expected positive outcomes from the policy. Lagarde made the observations while speaking with reporters during the side-lines of the spring meeting of the IMF and the World Bank. 

The Indian GST considered the biggest of its kind in the world would subsume many indirect taxes to arrive at a centralized taxation structure helping businesses as well as bring down end-product costs. GST is anticipated to add nearly 2% to India GDP by bringing informal economy into market-calculations as well as easing the burden of tax evasion.

Lagarde averred that tax reforms such as GST are positive and that they would result in Indian states by contributing better towards a federal tax structure. She was also impressed by the digital platform and the re-allocation of taxation structure, further conceding that positive outcomes were feasible through such reforms. 

Although many economists and think-tanks had apprehensions on the growth post demonetization, Lagarde remained supportive of the drive albeit the initial apprehensions at the IMF. She averred that the IMF had revised its India projections unexpectedly. But the drive had been "remedied" 75%, and hence it clearly indicated growth for the country. She forecasted a growth of 7.2% for India in 2017. 

Lagarde also admitted to being impressed with other reforms by the Indian government, referring to the bankruptcy code reforms aimed at dealing with the corporate banking sector. The Indian government’s policies are a product of clear determination to sustain growth, according to the 61 year old.