Upcoming 41st and 42nd GST Council Meetings – Key Expectations

Upcoming 41st and 42nd GST Council Meetings – Key Expectations

Goods and Services Tax (GST) Council meeting is likely to be held on August 27 and another meeting will be scheduled on September 19.

As decided earlier by the council itself earlier, the August 27 GST Council meet, which will be the 41st Council, will be to discuss a single point agenda that is to iron out measures to meet the compensation requirements to continue to pay off states.

The 42nd GST Council meet, scheduled for September 19 will be a full council meet to discuss other agenda items :

a. Administration of tax evasion cases in an effective manner.

b.From the revenue collection prospective the tax rates of luxury goods like automobiles and sin goods like tobacco, pan masala etc may rise.

c. Implementing GST Tribunals and its creation shall also be a matter of discussion.

41st GST Council Meeting:

Since the main objective of this meeting is about the matter of compensation to the state for revenue provided by the Central Government which will not be possible and which the Centre has already cleared due to deficit in revenue collection. In this situation expectation are made from the Finance Minister Mrs. Nirmala Sitharaman to perform the following solutions:

a. To resolve the difference that is arising between the Centre and State over the cess liability.

b. It seems that there is a possibility to analysis and evaluate an approach towards market borrowings. This will be in order to compensate the deficit is a solution put forth by the Centre. Since the Centre can allow states to borrow on the strength of future receipts from compensation funds, But the decision of the Central Government shall be considered as final in the matter.

c. Or by simply adding more items under the compensation cess.

d. The debate by the state is that the Centre is responsible to pay compensation on time and that the compensation funds will not have sufficient funds to cover the borrowings.

e. The State thereby considers it favorable for raising tax rates for revenues and for expansion of the amount of compensation cess.

42nd GST Council Meeting:

The discussion in the 42nd council meeting will be on raising of tax rates on luxury and sin goods, powerful and effective administration and insertion of GST Tribunals

a. The council may consider the rise of tax rates on goods like pan masalas. Current rate is 100% cess and having an upper celling of 130% in order to support cess collection.

b. Similarly, the Aerated drinks and tobacco which are now at 12% have upper limit of 15% as celling and that of tobacco which is limited to Rs. 4170 per 1000 sticks or 290% where the amount of tax is proportionate to the estimated value of goods or transactions concerned. This in turns gives enough opportunity to insert additional cess and thereby increase GST revenue for sin or luxury goods.

c. The GST council will also draw attention to take serious measure for tax evasions and thereby create and effective admirative system.

d .The discussion will further also throw light on the insertion and establishment of GST tribunal. This is a much needed approach expected to be taken by the GST council in order to resolve matters efficiently and promptly.

Tags : GST, GST Council Meeting, News

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