The single rate of tax at which the government collects the same amount of revenue under a new tax regime as it did under the old one; it was a key concept while designing GST so that the switch did not lose revenue.
- The RNR is the rate that keeps total tax collection unchanged after a tax reform, leaving the government neither better nor worse off in revenue terms.
- During GST design, expert committees estimated an RNR so that the combined GST rates would broadly replace the revenue from the taxes being subsumed.
- The committee chaired by the then Chief Economic Adviser Arvind Subramanian recommended an indicative RNR and a standard rate band for GST (around the mid-teens to high-teens percentage).
- The actual GST slab structure was then set by the GST Council, balancing revenue neutrality against equity (lower rates on essentials); see concept gst slabs.
- It links to revenue protection, the compensation cess, and centre-state finances under concept gst.
The idea (a rate that protects revenue after a reform) and its role in GST design (the Subramanian committee's RNR recommendation) are testable indirect-tax facts.
The RNR is the revenue-protecting rate used in design, not an actual published GST slab; the final slabs differ from the single theoretical RNR.
The rate that keeps tax revenue unchanged after reform; a key GST design benchmark recommended by the Subramanian committee.