Skip to main content

Last gasp tasks: GST bills and rate fitment process (Hindu)

After the agreement on all GST bills, the rate fitment process needs to be addressed

At its twelfth meeting last Friday, the Goods and Services Tax (GST) Council cleared all the requisite State and Central-level legislative measures to implement the indirect tax regime. The State and Union Territories’ GST bills were approved along with necessary corrections to the three other GST Bills the Council had cleared previously — for Central GST, Integrated GST and compensation to States through a cess. This paves the way for State Assemblies and Parliament to ratify these laws quickly in order to meet the proposed July 1 rollout date for the system. Finance Minister Arun Jaitley has said the Union Cabinet will soon take up the four laws that the Centre has to steer through Parliament, while the respective State governments will take up the State GST law. Separately, officers from the States and the Centre are expected to finalise, by this weekend, drafts for four pending regulations out of a total of nine, that lay down the administrative procedures and processes to be followed by taxpayers under the GST regime. The Council will meet again on March 31 to consider those drafts. This will give the Centre enough buffer to make the transition to the new system.

Though industry has indicated that it needs at least three months to prepare for the GST once it sees the fine print, one major action will still be pending on April 1. That action — the fitment of thousands of commodities and services into the five GST rate slabs (zero, 5%, 12%, 18% and 28%) — could prove to be among the trickiest for the Council. The rate fitment process, unlike legislative nuances, is more susceptible to lobbying not just from different sections of industry, but also States that would like a favourable tax treatment for products and services they excel in. For instance, the GST Council has now approved a ceiling on the cess that could be imposed over and above the highest GST rate of 28% on pan masala, chewing tobacco and cigarettes, luxury cars and aerated drinks. For all such ‘sin goods’, the cess ceiling has been set higher under the GST than the level necessary to maintain the present level of taxation. But beedis have been kept out of the cess net altogether in order to avoid friction with States that could delay the broader reform. Despite such pulls and pressures, in a best-case scenario the rate-setting process should take at least a fortnight and the Council could meet some time in April to approve the rates. Giving lakhs of enterprises just about two months to switch to the GST regime, with all its implications for supply chains, pricing strategies and accounting systems, could lead to a messy start. The Centre must keep its mind open on pushing forward the rollout by a month or so, while industry should rise above heckling over rates and invest more lobbying energy on bigger worries, such as the GST’s penal anti-profiteering clauses.

Comments

Popular posts from this blog

SC asks Centre to strike a balance on Rohingya issue (.hindu)

Supreme Court orally indicates that the government should not deport Rohingya “now” as the Centre prevails over it to not record any such views in its formal order, citing “international ramifications”.

The Supreme Court on Friday came close to ordering the government not to deport the Rohingya.

It finally settled on merely observing that a balance should be struck between humanitarian concern for the community and the country's national security and economic interests.

The court was hearing a bunch of petitions, one filed by persons within the Rohingya community, against a proposed move to deport over 40,000 Rohingya refugees. A three-judge Bench, led by Chief Justice of India Dipak Misra, began by orally indicating that the government should not deport Rohingya “now”, but the government prevailed on the court to not pass any formal order, citing “international ramifications”. With this, the status quo continues even though the court gave the community liberty to approach it in …

Khar’s experimentation with Himalayan nettle brings recognition (downtoearth)

Nature never fails to surprise us. In many parts of the world, natural resources are the only source of livelihood opportunities available to people. They can be in the form of wild shrubs like Daphne papyracea and Daphne bholua (paper plant) that are used to make paper or Gossypium spp (cotton) that forms the backbone of the textile industry.

Nothing can compete with the dynamism of biological resources. Recently, Girardinia diversifolia (Himalayan nettle), a fibre-yielding plant, has become an important livelihood option for people living in the remote mountainous villages of the Hindu Kush Himalaya.

There is a community in Khar, a hamlet in Darchula district in far-western Nepal, which produces fabrics from Himalayan nettle. The fabric and the things made from it are sold in local as well as national and international markets as high-end products.

A Himalayan nettle value chain development initiative implemented by the Kailash Sacred Landscape Conservation and Development Initiati…

NGT terminates chairmen of pollution control boards in 10 states (downtoearth,)

Cracking the whip on 10 State Pollution Control Boards (SPCBs) for ad-hoc appointments, the National Green Tribunal has ordered the termination of Chairpersons of these regulatory authorities. The concerned states are Himachal Pradesh, Sikkim, Tamil Nadu, Uttarakhand, Kerala, Rajasthan, Telangana, Haryana, Maharashtra and Manipur. The order was given last week by the principal bench of the NGT, chaired by Justice Swatanter Kumar.

The recent order of June 8, 2017, comes as a follow-up to an NGT judgment given in August 2016. In that judgment, the NGT had issued directions on appointments of Chairmen and Member Secretaries of the SPCBs, emphasising on crucial roles they have in pollution control and abatement. It then specified required qualifications as well as tenure of the authorities. States were required to act on the orders within three months and frame Rules for appointment [See Box: Highlights of the NGT judgment of 2016 on criteria for SPCB chairperson appointment].

Having fai…