Inching India closer to a unified tax system - One Nation, One Tax - Goods and Services Tax (GST) Council on Friday tentatively approved four sets of rules, such as composition, valuation, input tax credit and the transition process and finalised rest five others as well, aiming at the rollout schedule of the GST regime from July 1.
The panel headed by Finance Minister Arun Jaitley will also meet again on May 18-19 in Srinagar to finalise the rate structure of different commodities and services as to approve the remaining ones.
“The four new rules have been tentatively approved and put up in public domain for suggestions. These will be finalised in the Council’s next meeting. The next meeting will take place on May 18-19 in Srinagar, where besides finalising these rules, the rate classification exercise will also be taken up,” Jaitley told reporters after the Council’s meeting.
Besides these four draft rules, the council, which had already approved five other rules involving registration, payment, refund, invoices and returns, in the previous meeting, also finalised on Friday, factoring in amendments to make these compatible with the GST Bills that the lok Sabha passed earlier this week.
“The five set of draft rules that were originally approved have been corrected in consonance with the GST legislations,” said Jaitley.
As far these GST rules are concerned, framing of rules is mandatory to activate laws. Now, the focus will shift to the ‘classification’ or ‘fitment’ exercise - a comprehensive, if not exhaustive, list specifying the tax rate that each good and service will attract.
On Wednesday, the lok Sabha passed four crucial legislations to introduce a country-wide goods and services tax (GST) bringing India closer to a one unified market.
The lok Sabha passed the Central GST Bill, 2017 (The CGST Bill), Integrated GST Bill, 2017 (The IGST Bill), Union Territory GST Bill, 2017 (The UTGST Bill) and the GST (Compensation to the States) Bill 2017.
The passage of such Bills’ seems to be a big step forward in India’s plans for country-wide GST. The fifth law - SGST Bill - will be taken by the state Governments through their cabinets to respective state assemblies.
The Council has already agreed on a four-slab structure - 5, 12, 18 and 28 per cent - along with a cess on luxury and ‘sin’ goods such as tobacco. An officers’ panel will complete the fitment exercise of goods and services according to this slab structure, which will be taken up in the Council’s next meeting.