Let's Get Down to Business: 56th GST Council Meeting Highlights
Upcoming GST Council Meeting: Anticipated Rate adjustments, taxes, and streamlining – Here's the forecast
Yo, guess what's poppin'? It's the 56th Goods and Services Tax (GST) Council meeting, babe! Originally scheduled for June, but it's got a packed agenda and a monsoon Parliament session on the horizon – so, it's movin' to the last week of June or early July instead.
Tanya Krishna here, bringin' you the 411 on what's gonna go down. The main topics on the menu are GST rate rationalization, the future of the Compensation Cess, and improvements in compliance.
GST Rate Rationalization:
Closer tax slabs, less headache?
Here's the scoop: The Council's discussin' a proposal to simplify the GST tax structure by reducin' the number of slabs from the current four to three, while potentially axin' the 12% tax slab entirely. If said proposal gets the green light, goods and services currently under the 12% tax slab could be movin' to the 5% or 18% slabs, depending on their nature and essentiality. A new 15% tax slab might even make an appearance, mergin' the existing 12% and 18% slabs[1].
Compensation Cess:
Movin' on up
Some states have raised concerns about the current Compensation Cess structure, as they're worryin' about revenue flowin' directly to the Centre if it continues. The Group of Ministers on this matter seems to be in favor of integratin' the cess into the existing GST rate structure instead[2].
Compliance Simplification:The Council is also tacklin' the issue of compliance simplification by sharin' ideas on better classification of intermediary services, streamlinin' procedurals, and reducin' compliance burdens for businesses[3].
Stay tuned as we get more deets on the exact date of the meeting and the agenda. In the meantime, keep chillin' and checkin' our rad website App for the latest business news in India!
References:[1] Economic Times[2] India Today[3] Business Standard[4] Financial Express[5] The Hindu BusinessLine
For nerds who wanna dig deeper:- The GST council comprises the Union Finance Minister, Nirmala Sitharaman, and finance ministers (or senior ministers) of states.- The council's first appellate authority processes issues related to GST disputes. However, the absence of the GST appellate tribunal has been pushing taxpayers to approach high courts instead, resulting in a backlog of cases.- To support businesses with multi-state operations, state-level GST registration processes need to align with the Central Board of Indirect Taxes and Customs' streamlined system. This step would facilitate faster registration, fewer rejections, and smoother pan-India operations for businesses.- The Insurance Products require policy attention, as Term insurance and health insurance are essential but are currently taxed at 18%. Lowering the tax rate or providing exemptions could significantly boost their penetration and align with broader public policy goals.
Source
- The discussion in the 56th Goods and Services Tax (GST) Council meeting focuses on potential changes in the GST market, including a proposal to simplify the tax structure by reducing the number of tax slabs from four to three.
- One of the proposals under consideration involves the integration of the current Compensation Cess into the existing GST rate structure, aimed at addressing concerns about revenue flow from states.
- The Council is also keen on improving compliance for businesses by sharing ideas on better classification of intermediary services, streamlining procedures, and reducing the compliance burden.
- In the realm of finance and business, the future of several industries, including insurance products like term insurance and health insurance, are under review, with a potential lowering of tax rates or exemptions proposed to boost their penetration and align with broader public policy goals.
