GST Council to meet today amid rate cut talk

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New Delhi, Dec 21: The Goods and Services Tax (GST) Council will meet on December 22 amid heightened expectations that the panel will cut rates on several items, although some states want the move’s impact on revenues to be fleshed out in greater detail before levies are lowered.
A discussion on the revenue position of the Centre and states, easing refund-related rules for exporters, is also likely to be on the agenda.
The Council, headed by finance minister Arun Jaitey is the highest decision making body of the new indirect tax system that came into effect from July 1, 2017.
It is also expected to take up the issue of transferring ownership of the IT backbone GST Network in a government owned company, a proposal that was approved by the Cabinet in September, sources said.
In addition, there could be discussions on reducing cess on plug-in hybrid cars, which currently falls in the 28 percent tax slab. However, the overall tax incidence for the green vehicle is 43 percent right now.
It is learnt that the road ministry has proposed bringing down the tax liability to 35 percent.
Rate cuts have always been a contentious issue as the Centre and states have to come to a consensus. In that light, the meeting assumes all the more significance, coming as it does after the recent elections in five states that saw the Congress wresting power in all the three Bharatiya Janata Party (BJP)-ruled states.
Days ahead of the meeting, Prime Minister Narendra Modi said the government wants to ensure that ‘99 percent things’ attract GST at 18 percent or lower rate.