A panel of state ministers set up by the all-powerful Goods and Services Tax (GST) Council to suggest changes to the tax structure is expected to review the implication of rate rationalization on at least 100 items at its two-day meeting in Goa.
The six-member panel headed by Bihar Deputy Chief Minister Samrat Chaudhary is scheduled to meet on September 24 and September 25 to discuss change in GST slabs and rates and its impact particularly on essential items, an official source with direct knowledge told NDTV Profit.
The final call, however will be taken after more deliberations which could be done in subsequent meetings by the panel, he said. The panel had met on August 22 and had submitted the status report to the Council on September 9.
The panel also includes Uttar Pradesh Finance Minister Suresh Kumar Khanna, Rajasthan Health Services Minister Gajendra Singh, and Kerala Finance Minister K N Balagopal.
In the upcoming meeting, the Group of Ministers are likely to give a fresh look on tinkering with current rates and slabs, merger the existing slabs and correcting the inverted duty structure, official cited above said. The state panel might examine rate changes in specific sectors including textile, fertilizer, handloom which requires detailed review, he added.
During the August meeting, the ministerial panel had broadly converged on retaining the four-slab tax structure. The panel though asked the Council-nominated Fitment Panel to examine the revenue implication on some items and seek relevant data.
Fitment panel which comprises of revenue officials of Centre and States learnt to have submitted three options to the GoM which could be taken up by the panel in its upcoming meeting.
Of the three rate structures on the table, one suggests tax slabs of 7%, 14% and 21%. The other proposal is of 8%, 16% and 24%. While the third option is 9%, 18%, and 27%.
Sources said that all the options were proposed to state panel keeping no adverse impact on the prices of mass consumption items.
Currently, goods and services tax (GST) is a four-tier tax structure with slabs at 5, 12, 18, and 28 per cent.
Under the GST, essentials goods are either fully exempt or subject to the lowest tax rate, whilst luxury and sin goods attracts highest slab of 28%. On luxury and sin goods, Cess is imposed over and above the highest tax rate.
Notably, another GoM on real estate is also expected to meet in Goa during the period. The state panel led by Goa chief minister Pramod Sawant is looking at exempting GST on industrial land/plots on 30+ year leases and whether there should be an exemption of GST on cooperative societies.
