Finance Minister Nirmala Sitharaman will hold her maiden GST Council meeting today to decide upon important matters such as slashing tax rates on electric vehicles, revised and compulsory norms for e-ticketing, tweaking GST rate on lotteries and evasion of GST by businesses, among others. As the manufacturing, auto and construction industries have been facing a slowdown, the government is under immense pressure to cut GST rates. Thus, bringing down the number of items that charge 28% GST can also be on the cards. Nirmala Sitharaman will meet state finance ministers to seek their suggestions on the upcoming union budget for FY20. This will be the first GST meet after Narendra Modi regained the reins of the country last month.
Checking GST evasion
Keeping in mind the huge tax evasion, the GST council may also decide upon compulsory e-invoicing for big companies. This is proposed to be imposed on transactions over Rs 50 crore. The government can also improve the tax compliance by businesses and merchants by improvising GST filing. The government may also deliberate upon anti-tax evasion steps such as integration of e-way bill with NHAI’s FASTag from April 1, 2020 and creating a mechanism for single-point sanctioning and processing of GST refunds.
Auto sector
One of the major expectations from the GST council meeting will be the reduction of GST tax rates from the current 28% to 18% as the automobile industry reels under sluggish demand.
Cement industry
The cement industry also expects a GST reduction from 28% to 18% which may give a boost to the real estate sector.
In the last GST council meeting in December, the government decided to bring down tax rates on 23 goods and services, which include movie tickets, TV and monitor screens, and power banks. It also brought frozen and preserved vegetables under levy exempted products. The 28 per cent slab was rationalised and the Council restricted the highest slab to luxury, demerit, and goods, besides cement, large screen TV, Air Conditioners and dishwashers.
