Formation of GST Council gets cabinet nod; first meet on Sep 22

NEW DELHI(PTI): The Cabinet cleared the process, formation and functioning of the GST Council, which will decide on the rate of tax under the new indirect taxation regime.

The Council, to be headed by Finance Minister Arun Jaitley and comprising of representative of all 29 states and two union territories, will have to be set up by November 11.

It will decide on the tax rate, exemptions and threshold limits in the new indirect tax regime, which is expected to kick in from April 1, 2017.

The government has notified September 12, as the date from which the procedure for setting up of the GST Council will be initiated and which will be completed within 60 days.

The GST council, which will now decide all matters concerning the new tax as a recommendatory body, will kick off with its first meeting here on September 22 and 23.

The Cabinet headed by Prime Minister Narendra Modi approved the process, formation and functioning of the GST Council.

The Cabinet also decided on the constitution of the GST Secretariat and the officers who will implement the decisions of the Council.

The GST Council will be chaired by Union Finance Minister and have a Minister of State for Finance and all state finance ministers as its members.

It also decided to give additional responsibility to the Secretary (Revenue), to perform duties as the Ex-officio Secretary to the GST Council as well. Heads of Central Board of Excise and Customs (CBEC), will be permanent invitee (non-voting) to all proceedings of the GST Council.

One post of Additional Secretary and four posts of Commissioners have been created to work in the GST Council Secretariat.

While the Centre will have one-third vote, states together will have a two-third say.

To adopt a resolution, three-fourth majority would be required.

The cabinet has also decided to provide for adequate funds for meeting the recurring and non-recurring expenses of the GST Council Secretariat, the entire cost for which shall be borne by the Central Government. The GST Council Secretariat shall be manned by officers taken on deputation from both the central and state governments.

The approval came on the day when the Constitution Amendment Act on GST came into effect.

President Pranab Mukherjee gave his assent to the bill last week, paving the way for setting up of a GST Council.

GST is a single indirect tax, which will subsume most of the central and state levies such as Value Added Tax (VAT), Excise Duty, Service Tax, Central Sales Tax, additional Customs Duty and special additional duty of customs.

Parliament on August 8 had passed the bill, which then went to the states for ratification. A Constitution Amendment Bill needs to be ratified by the legislative Assemblies of at least 50% of the 29 states and 2 union territories.

The bill was sent to the President’s secretariat after as many as 19 states — BJP-ruled Assam being the first — ratified the bill.

The other states, which passed the legislation include Bihar, Jharkhand, Chhattisgarh, Himachal Pradesh, Gujarat, Madhya Pradesh, Delhi, Nagaland, Maharashtra, Haryana, Sikkim, Mizoram, Telangana, Goa, Odisha and Rajasthan.

Revenue Secretary Hasmukh Adhia had recently said the government is ahead of schedule for implementation of GST.

“Instead of 30 days kept for this (states’ ratification), it is achieved in 23 days,” he had tweeted.

The states and the Centre are working overtime and talking to stakeholders to draft the Central GST, State GST and Integrated GST laws, which are to be passed in Winter Session of Parliament.

The CGST and IGST will be drafted on the basis of the model GST law. The states will draft their respective State GST (SGST) laws with minor variation incorporating state-based exemptions. The IGST law would deal with inter-state movement of goods and services.

Posted by on September 12, 2016. Filed under Nation. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.