GST: Matter of dual control of tax remains undecided, council to meet again on January 16
Kerala’s finance minister said the uniform tax might be introduced in September this year.
The Goods and Service Tax Council meet ended on Wednesday afternoon, with the matter of dual control over the tax remaining undecided. The council will meet next on January 16. The Centre had hoped for the uniform tax to be introduced on April 1 – a plan that became unlikely with GST-related Bills not being passed in the Winter Session of Parliament, and continuing deadlocks at council meetings. Kerala Finance Minister Thomas Isaac on Wednesday said the uniform tax, which will replace around 17 separate taxes in the country, could be rolled out in September.
Finance Minister Arun Jaitley said the GST Council discussed about requirements of six economic sectors during the meet. He said definition of territory and dual control were the issues that remained pending after the meet. He said the issued would be hopefully resolved in the next meeting.
“We will end the year with higher revenues in both direct and indirect taxes, will exceed budget estimates,” Jaitley said, adding that he had asked states to submit revenue data of past two to three years.
The subjects of dual control and and cross-empowerment have been discussed at the past few council meetings as they remain unresolved. Earlier, representatives had agreed that states will be paid 100% compensation for loss of revenue every two months from the time the new tax regime is rolled out for a period of five years, Finance Minister Arun Jaitley said. Jaitley had said the legally assessed draft of the law on compensation for states would be discussed at the January meeting, along with the matter of dual control and the integrated GST law. Jaitley also said he would also hold budget consultations with state finance ministers.
Discussions about the new tax regime include deliberations over the clauses of the three draft laws that deal with the tax – the central GST, the integrated GST and the compensation for states. The primary draft law of the CGST and SGST were approved by the council.
The draft laws were set to be introduced in Parliament during the Winter Session, but the Centre will probably place them for discussion during the Budget Session, which is likely to start on January 31. As the sixth meeting of the council on December 11 ended inconclusively, the April 1 deadline set for the rollout of the GST was ruled out.
The GST Bill got President Pranab Mukherjee’s approval on September 8, after being ratified by 16 states. It was passed by the Rajya Sabha on August 3. It seeks to replace India’s complicated tax regime comprising 17 different charges with a single levy.