The subjects of dual control and and cross-empowerment remained unresolved even as the two-day meeting of the Goods and Services Tax Council in Delhi ended on Friday. However, representatives 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.
The legally assessed draft of the law on compensation for states will be discussed at the next meeting, in addition to the matter of dual control and the integrated GST law. Jaitley will also hold budget consultations with state finance ministers in the second half of the council’s next meeting, which is scheduled for January 3 and January 4.
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 is now likely to place them for discussion during the Budget Session, which will begin in January. 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.