Arun Jaitley chairs GST Council meet to deliberate over rates, compensation to states

Finance Minister Arun Jaitley will chair the three-day meeting of GST Council beginning Tuesday to deliberate over a range of issues. GST rate and compensating states against revenue losses under the new tax regime are likely to dominate the council meet.

According to experts, the most important aspect of the rollout is going to be the GST rate which will also determine the shape of the economy for the foreseeable future.

To ensure the smooth functioning of the GST dispensation across the country, finance ministry has set November 22 as the deadline for building consensus on all the issues in the Council.

Earlier Finance Minister Jaitley had already pointed out that the rate for ‘environmentally unfriendly products will be distinct’ from others. 

The first report of the panel headed by Chief Economic Advisor Arvind Subramanian had suggested - 17-18 per cent as the standard rate for bulk of goods and services, 12 per cent for low rate goods and 40 per cent for demerit ones like luxury cars etc. For precious metals, it recommended a range of 2-6 per cent.

GST Council will also discuss the vexed issue of Centre retaining power to assess 11 lakh service tax filers under the new dispensation.

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The finance ministry will to reach a consensus on the pending key issues so that subsequent Central GST (CGST) and integrated GST (IGST) legislations can be introduced in the month-long Winter Session of Parliament starting November 16.

In the last meeting members agreeing on area-based exemptions and how 11 states, mostly in the North-East and hilly regions, will be treated under the new tax regime.