CA Pratibha Goyal | Feb 18, 2023 |
Key Decisions made in 49th GST Council Meeting
The GST Council has resolved to pay up all outstanding debts owed to the states in relation to GST compensation today only.
Nirmala Sitharaman, the finance minister, stated that some of the compensation dues for the month of June will be paid today even if the money is not in the compensation cess budget after the council’s 49th meeting in New Delhi.
The cash will be issued from the Consolidated Fund of India and later recovered, the minister added.
According to revenue secretary Sanjay Malhotra, a total of Rs 16,892 crore will be distributed among 23 states as compensation payments. The revenue secretary added that an additional Rs 16,524 crore will be given to six states once AG-verified numbers are available.
GST dues to States to be fully cleared today subject to formalities of fund audit report
The council also made several choices about rate rationalization in addition to the compensation cess. Here they are:
If sold in loose form, rates on Rab, or liquid jaggery, have been reduced from 18% to 0%. The rate has been lowered to 5% in the event that it is pre-packaged.
Sharpeners now cost 12 percent instead of the previous 18 percent.
Tax tracker rates have been reduced from 18% to 12%, although there are some restrictions. The cost of court services will be determined via the Reverse Change Mechanism (RCM).
Also, it was decided to rationalize the late fee for small taxpayers with yearly revenue of up to Rs 20 crore who file annual returns or GSTR 9 beyond the deadline.
GST Council decreases levy of GST on pencil sharpeners to 12%
The council has also approved two reports from the Group of Ministers (GoM). One of them is the capacity-based taxation on chewing tobacco and Gutka Pan Masala.
With some wording adjustments, the other one focuses on the GST Appellate Tribunals (GSTATs). The language will be changed, and a draught will be distributed to the members tomorrow. After receiving feedback, a final document will be created with more explanation and distributed to the members once again.
The Finance Minister stated, “We are undertaking this exercise because there would not be sufficient time to meet again prior to the finance bill and we would like to include the establishment of GSTATs as part of the Finance bill.
The minister also stated that when it comes to GSTATs, the interests of the states won’t be harmed regarding representation in terms of members, the number of benches, or the location of the tribunals.
Goods made from millet: Talks did occur, however, there were some worries about the items’ makeup. No decision could be made as a result.
GST Rate on Cement was not on the agenda of the GST Council Meeting
About the equal tax treatment of MUVs and SUVs: Sanjay Malhotra, the secretary of revenue, stated that the fitment committee’s officers were unable to make any recommendations due to time constraints and that they still want further discussion.
The GoM report on online gambling was also discussed by the finance minister, who noted that it had been filed but that the meeting’s chair, Meghalaya Chief Minister Conrad Sangma, was unable to attend because of state elections.
We chose to wait on the report since it is inappropriate to discuss it without him, according to the minister.
The Revenue Secretary continued by saying that until a new system to tax internet gambling, etc. is established, the current law, which imposes a 28 percent aggregate tax, will remain in effect.
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