New Delhi: Clearing the decks for introduction of a major indirect tax reform in Parliament, the Centre and States on Thursday approved draft Bills for implementing the goods and services tax (GST) in States and Union Territories (UTs).
“The GST Council has granted its formal approval to all five legislations,” Finance Minister Arun Jaitley said after the meeting here on Thursday, adding that he would try to take them to Parliament expeditiously.
This is the 12th meeting of the GST Council. It had last met on March 4 when it cleared the Central and Integrated GST Bills. Previously, the Council had also approved a draft Bill to compensate States for any revenue loss arising out of GST for a period of five years.
With a targeted implementation date of July 1 for GST, the Centre is keen to take the four Bills — CGST, IGST, UTGST and compensation — to the Cabinet latest by next week and then table them in Parliament.
The Session adjourns on April 12 and passage of the Bills in the current Session is essential for the timely roll-out of the new tax system. The SGST Bill will be tabled in State Assemblies.
Sources said that the Council also decided that supplies made to special economic zones would be zero rated (a tax rate of zero) and considered as physical exports.
Cap on cess
The GST Council also approved a proposal to cap the cess on sin goods and environmentally harmful goods at 15 per cent.The Council will now meet on March 31 to discuss and finalise the rules on four issues relating to composition, transition, valuation and input tax credit.
“With this, all nine rules will be cleared by the Council,” Jaitley said, noting that five sets of rules relating to refunds, registration, invoices, payments and processes have already been approved. The committee of officers will then begin the fitment of commodities into the rate slabs and the Council is expected to hold another round of meetings thereafter to approve the exercise.
The Finance Minister expressed optimism, stating that the GST roll-out from July 1 seems to be on track.