Goods and Services Tax (GST) Council on Friday agreed on law for compensating states for revenue losses following the implementation of GST.
Goods and Services Tax (GST) Council on Friday agreed on law for compensating states for revenue losses following the implementation of the pan-India tax regime. The council, however, failed to arrive at consensus on Integrated GST (IGST) Bill and dual control regarding division of jurisdiction and administrative powers over tax assesses between the Centre and the states . GST Council will meet again on January 3-4 to decide on these key issues. The first day of the seventh meeting of the Goods and Services Tax (GST) Council ended yesterday with broad consensus over most of the clauses of the draft Central GST (CGST) Bill. Notably, the three Bills relating to GST, namely, the CGST Bill, the IGST Bill and the Bill for compensating states for revenue losses following the implementation of GST have missed the initial deadline of passage in the Winter Session of Parliament.
Following the clearance by the GST council, all the draft Bills are likely to be presented in the Session of Parliament. Subsequently, states will have to pass their state GST Bills in their respective assemblies. Tax experts said clarity on the contentious issues is keenly awaited by businesses for preparing themselves for the rollout of the indirect tax regime. Dual control is an issue on which Centre and states have sparred with each other since the second meeting of the GST Council in September. The tussle between the Centre and the states is about who will gain how much control over the taxpayer base of VAT, excise and service tax after the rollout of the proposed indirect tax regime. The resolution of the issue of dual control is crucial for the rollout of the indirect tax regime by next year.
You may also like to watch
The initial targeted April 1, 2017, deadline of GST will be tough for the government to meet but is constitutionally mandated to implement it before September 16, 2017. Last week, finance minister Arun Jaitley had said that being a transactional tax, GST can be introduced anytime between April 1, 2017 and September 16, 2017, though the intent of the government is to introduce GST as early as possible.