GST Council Meet: The Goods and Services Tax (GST) Council will meet today for the 28th time to discuss some crucial changes in the new indirect tax regime, for the first time in its second year.
GST Council Meet: The Goods and Services Tax (GST) Council will meet today for the 28th time to discuss some crucial changes in the new indirect tax regime, for the first time in its second year. Several prolonged decisions such as simplification of returns filing and tax on sanitary napkins are likely to be the highlight of the meeting.
The GST Council is a constitutional body, comprised of Union Finance Minister and is state counterparts, responsible for making decisions related to the GST regime. Interim Finance Minister Piyush Goyal will chair the meeting, which will be his first, as Arun Jaitley is recovering from the surgery performed in May.
The GST Council is expected to take up rate rationalisation on sanitary napkins, handicrafts and handloom goods along with some services on July 1. The GST Council meeting will be held amid a moderate nation-wide truckers’ strike and a day after high-octane non-confidence motion brought against the ruling party under the leadership of Narendra Modi.
Other likely agendas on the table are taking forward the proposal of simpler GST returns filing system, a glimpse of which was seen in the last council meeting held in May; whether or not to impose sugar cess on top taxes; formation of National GST appellate tribunal.
In May, the GST Council had given an initial blueprint of the single return filing system, which is likely to be fully introduced in phases in 6-12 months time. One may expect more details about the new filing system that will be brought in to ease the processes for businesses and subsequently increase compliance. The GST collection had hit Rs 1 trillion-mark in April, followed by Rs 94,016 crore in May and Rs 95,610 crore in June.
The GST compliance, as per last available data, has been stagnant at about 70% for a few months now and even the government has expressed concern over some possible tax evasion attempts by composition dealers. The GST Council rolled-out e-Way bill from April 1 to curb evasion.
Amid some reports of GST appellate tribunals — a quasi-judicial body — giving contradictory verdicts on pleas filed related to the new indirect tax regime, the council is also expected to consider setting up a National Appellate Tribunal in Delhi with three regional branches with an aim to reduce confusion.
The decision on sugar cess, which remained undecided and was sent to a committee for the report, could also be taken up tomorrow. However, Group of Ministers (GoM), headed by Assam Finance Minister Himanta Biswa Sarma, is not in favour of imposing the cess, as they fear, it would be against the principle of the GST and detrimental to some states. The opinion of Attorney General KK Venugopal has also been sought.
In this GST Council meeting, the expected rate rationalisation will come after a gap of five months. The council had last rates on 29 items and some services in January. The biggest rate rationalisation decision was taken by the council in November 2017 when over 200 items were brought in to lower tax brackets from 28%, 18%, and 12%. The GST was launched on July 1, 2017, subsuming over a dozen indirect taxes.
(First published on 20th July 2018 at www.financialexpress.com)