Delay in GST Council Meeting Worries Experts; Key Tax Issues Await Decision:

Delay in GST Council Meeting Worries Experts; Key Tax Issues Await Decision

As the state government is busy with their legislative work and budget session, the next meeting of the GST Council may not take place till the end of May or June 2025. This delay is resulting in problems for the tax experts and businesses who are worried regarding the time-to-time discussions on the important issues like rate rationalization, classification problems, compliance issues, and refunds. It is expected that the GST council will meet least once every three months, but it has been four months since the last meeting was held. Former Chairman Nijab Shah pointed out that while the Central government was busy with the union budget, it was important to have a meeting, particularly when tax reviews were promised earlier. He also stated that the long-pending merger of GST rates and the delay in setting up the GST Appellate Tribunal (GSTAT) are affecting both taxpayers and the government. There are many important decisions pending, including

• Clarifications on post-sale discounts
• Broader coverage under amnesty schemes
• Extension of compensation cess
• Tax issues related to food delivery platforms
• Discussions on rate reduction and rate rationalization

Experts are also worried about the plurality of tax rates, which has been a significant point of criticism. Though a Group of Ministers (GoM) has placed an interim report on rate rationalization, experts believe the issue has to be discussed at the GST Council level, with some seeking a special session on it. Industry associations are calling for a definite rate change roadmap, providing companies sufficient time to make adjustments and steer clear of anti-profiteering probes in the future. Although there were previous reforms, there is apprehension that the pace has weakened. As per Regulation 6 of the Procedures of the GST Council, the Council must meet every quarter, but since June 2022, meetings have become less frequent. There's also a need for sector-specific committees to tackle focused issues such as virtual digital assets and health and life insurance sectors. There are also calls for fewer GST exemptions, since these interfere with value chains and bring in lobbying. Other matters pending resolution include:

• Delays in GST refunds and registration
• The undue delay in establishing the GST Appellate Tribunal (GSTAT), even after the appointment of a President in May 2024. This is holding it back from functioning, increasing litigation expenses and uncertainty for taxpayers.

Experts are also concerned about the variation in Advance Rulings (AARs) among states, causing confusion among businesses. They recommend establishing a National Authority for Advance Rulings so that there can be consistent and clear legal interpretation. The last GST Council meeting took place in December 2024 in Jaisalmer, and since then, numerous discussions, particularly regarding GST rates for insurance, real estate, and gaming, remain pending. Due to increasing pressure from various quarters, the government is likely to conduct the next meeting by June 2025.