GST council: Centre, states to meet today to decide on tax rate
November 3, 2016. 08:18 IST
Centre is likely to press its proposal for 4-tier tax structure of 8, 12, 18 and 26 per cent, the peak rate being for FMCG and consumer durables.
With barely a fortnight left for Parliament’s Winter Session, the GST Council will begin its crucial 2-day meeting on Thursday to decide on tax rate including the levy of cess and sort out the vexed issue of jurisdiction over assessees.
At the meeting, to be chaired by Finance Minister Arun Jaitley, the Centre is likely to press its proposal for 4-tier tax structure of 8, 12, 18 and 26 per cent, the peak rate being for FMCG and consumer durables.
Meanwhile, Minister of State for Finance Arjun Ram Meghwal told PTI that there had been “minor” differences over the issue of cess but expressed confidence that it will be resolved.
He said: “Our effort is to decide on all matters through consensus. We want everyone to come around on all issues... There may be times when Tamil Nadu or Kerala or West Bengal or Uttar Pradesh have said something different but we will get them around. “We are confident that the GST will be rollout from April 1, 2017...all issues would be sorted out before that.”
The Centre has also proposed to levy additional cess on demerit goods like tobacco, aerated drinks and polluting items to create a Rs 50,000 crore fund to compensate the states for revenue loss.
The proposal, which was discussed at the last meeting, could not be adopted by the Council because of opposition by some states.
The meeting beginning today will have to sort out the issues concerning tax rate to enable Parliament to approve the Central GST (CGST) and Integrated GST (IGST) legislations in the winter session beginning November 16 and pave way for roll out of the new tax regime from April next year.'
Some central officials say it is “unfortunate” that states are opposing the cess despite assurances for compensating revenue loss for initial five years.