The government is touting it as the biggest tax reform since Independence. Its critics (and there are a few) call it a good idea that has been mangled beyond recognition. The final iteration of the Goods and Services Tax (GST), after rates were determined for all goods and services on May 19, answers to both descriptions equally.

There is no doubt the GST is a giant step forward in simplifying the tax regime. By prescribing a single tax rate for a good/ service irrespective of the state it originates in, or the state it gets consumed in, GST brings a certain order to taxation. But we didn't go the whole hog. Other countries that implemented GST went with a single tax rate (or at best two).

Here, the Centre and states have agreed on four basic rates (set at 5, 12, 18 and 28 per cent) apart from a list of items that will attract zero tax. This was already bad enough without the added confusion of surcharge, which can vary from 3 per cent to 290 per cent! Even services have been carefully divided into four categories attracting different tax rates.

A reading of the GST rates for different items also raises some queries about the government's priorities. For example, coal will be taxed at 5 per cent (from 11.7 per cent earlier) and solar modules at 18 per cent (from near zero earlier). Likewise, hybrid cars will be taxed at the same rate as petrol and diesel cars, with big hybrid cars attracting as much as 43 per cent (28 per cent + 15 per cent surcharge). If the government is keen on reducing pollution and promoting clean renewable energy, the GST rates give no indication of this.

Bureaucrats have done their damnedest to list taxable products and services and it makes for some entertaining reading. One example: all live horses attract 12 per cent tax, while other live animals (including asses, mules, hinnies, bovines, swine, sheep, goat, birds and insects) attract zero tax. The meat of all these animals (bovine, horse or ass) will attract zero tax as long as it is considered 'fresh and chilled' but is taxed at 12 per cent once frozen and put in unit containers.