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Informist, Tuesday, Aug 27, 2024

 

--Sitharaman: To review progress on GST rate rationalisation panel work 
--Sitharaman: May discuss GST compensation cess Sep 9 if states want 
--Sitharaman: To discuss rate rationalisation at Sep 9 GST Council meet 
 

NEW DELHI – The central government will discuss the issue of rate rationalisation at the upcoming GST Council meeting with the states, Finance Minister Nirmala Sitharaman said today. The GST Council will hold its 54th meeting on Sep 9 in New Delhi. 

 

At the upcoming meeting, the officers will give a detailed presentation on the progress made so far by the ministerial panel tasked with accessing rate rationalisation, Sitharaman said. However, there may not necessarily be any big announcement related to rate rationalisation after the September meeting, Sitharaman added. 

 

The GST Council, in its previous meeting in June, had tasked the rate rationalisation panel to give a broad overview of the work done or a draft report on GST rate rationalisation. It would include the status of the work, aspects covered by the panel so far and work pending before the panel. The panel had also met Sitharaman on Thursday. 

 

After taking stock of the panel's progress in September, the group of ministers will continue its work further and announcements may come at the subsequent GST Council meetings, Sitharaman said.  

 

The primary objective of the rate rationalisation panel of the GST Council, which was set up in 2021, is to simplify the goods and services tax structure, rationalise and correct inverted duty structure, and review GST exemptions. Bihar Deputy Chief Minister Samrat Chaudhary is the convenor of the panel that also includes Kerala Finance Minister K.N. Balagopal, Uttar Pradesh Finance Minister Suresh Kumar Khanna, Goa Transport Minister Mauvin Godinho, and Rajasthan Medical, and Health Services Minister Gajendra Singh.

 

The Centre may also discuss the future of the collection of GST compensation cess post March 2026, Sitharaman said. When the GST regime was introduced in 2017, the Centre had promised to protect 14% revenue growth for states for the first five years by levying a cess on some luxury items.

 

The five-year period ended in June 2022. The GST Council in September 2021 approved extending the compensation cess levy till March 2026 to service the loan taken to offset the shortfall in revenue collections. The Centre borrowed 2.69 trln rupees in 2020-21 and 2021-22 and passed it on to states as back-to-back loans when GST collections dwindled during the pandemic.  End

 

Reported by Krity Ambey

Edited by Akul Nishant Akhoury

 

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