The Goods and Service Tax Council meeting scheduled for November 25 has been postponed to December 2-3. The meeting was rescheduled because state officers have sought more time to discuss the three draft legislations – central GST, integrated GST and the law on compensation for states – the Finance Ministry said in a notification.
Officers of the states and Centre will meet in Delhi on November 25 to finalise the three draft legislations, after which they will be presented to the council. “The states have suggested certain changes related to returns procedures in the model GST law. They have also asked for changes in wordings in the compensation law,” an official told PTI.
The Central GST will be framed based on the model GST law, whereas the Integrated GST will deal with inter-state movement of goods and services. The compensation law will chalk out how states will be compensated in the first five years of the implementation of the new tax regime.
The National Democratic Alliance government at the Centre hopes to introduce these three legislations as money Bills in the Lok Sabha during the ongoing Winter Session of Parliament as it does not have a majority in the Rajya Sabha. The Upper House cannot make amendments to a money Bill passed by Lok Sabha.
This is the second time in November that the GST Council meeting has been postponed, reported Mint. The meeting was initially scheduled for November 9-10, which was later deferred to November 24-25. The council is still divided on how the Centre and states will divide the authority to implement the new tax system. Finance Minister Arun Jaitley had said that two competing authorities cannot assess the same taxpayer.
On November 3, the council had decided on a four-tier rate structure of 5%, 12%, 18% and 28%. Items of mass consumption will attract the lowest rate, while luxury goods and demerit items such as aerated drinks, paan masala, luxury cars and tobacco products will be taxed at 28%.
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.