News Highlights
The Centre will raise GST on certain Goods and Services including kitchenware to 18% from 12%
GST Council’s Meeting Outcome
- Tax rate will be increased for over two dozen goods and services, ranging from unbranded food items, curd and buttermilk to low cost hotels, cheques and maps
- Tax rates will be lowered for about half dozen goods and services, including ropeways and truck rentals where fuel costs are included, and scrapped for items imported by private vendors for use by defense forces.
- At the meeting, over a dozen States wanted the GST compensation to continue for some more time
- The Council has also clarified that Assisted Reproductive Technology and In Vitro Fertilization (IVF) services are covered under the health care services for the purpose of GST exemption, but stem cell preservation services will no longer be tax free.
- Reason for the GST Hike: High Inflation was the major reason for tax hike
GST Council
- Goods and Services Tax Council (GST Council) is a constitutional body for making recommendations to the Union and State Government on issues related to Goods and Service Tax.
- Background of GST Council
- The 101st Amendment Act of 2016 paved the way for the introduction of a new tax regime, goods and services tax – GST in the country.
- As per Article 279A (1) of the amended Constitution, the GST Council has to be constituted by the President within 60 days of the commencement of Article 279A.
- The notification for bringing into force Article 279A with effect from 12th September, 2016 was issued on 10th September, 2016.
- As per Article 279A of the amended Constitution, the GST Council which will be a joint forum of the Centre and the States, shall consist of the following members : –
- Union Finance Minister: Chairperson
- The Union Minister of State, in-charge of Revenue of finance – Member
- The Minister In-charge of finance or taxation or any other Minister nominated by each State Government – Members
- As per Article 279A (4), the Council will make recommendations to the Union and the States on important issues related to
- the goods and services that may be subjected or exempted from GST
- model GST Laws
- principles that govern Place of Supply
- threshold limits
- GST rates including the floor rates with bands
- special rates for raising additional resources during natural calamities/disasters
- special provisions for certain States, etc.
- Quorum and Decision making
- For a valid meeting of the members of the GST Council, at least 50 per cent of the total number of members should be present at the meeting.
- Every Decision made during the meeting should be supported by at least 75 per cent majority of the weighted votes of the members who are present and voting at the meeting. In “article 279A” a principle is there which divides the total weighted vote cast between Central Government and State Government:-
- The vote of the Central Government shall have the weight of one-third of the total votes
- The votes of the State Government shall have the weight of two-third of the total votes, cast in the meeting
Pic Courtesy: The Hindu
Content Source: The Hindu