All you need to know about GST bill

The cabinet has approved to drop the additional 1 percent tax in the proposed bill

GN Bureau | July 28, 2016


#Rajya Sabha   #cabinet   #GST bill  


 In an attempt to allow for a smooth passage of the Goods and Services Tax (Constitutional Amendment) Bill in the Rajya Sabha, the cabinet has approved to drop the 1 percent additional tax and also to guarantee states compensation for any revenue loss in the first five years of rollout.

The cabinet also decided that any dispute between states and the centre would be adjudicated by the GST Council, to have representation from both the centre and states.
 
The bill has faced hurdles in the Rajya Sabha in the past due to lack of a clear majority by the BJP.
 
Here’s all you need to know about the bill:
 
  • Concurrent powers to union and state legislatures to legislate on GST.
  • A goods and services tax council will be created as a joint forum of the centre and the states. The council would make recommendations to the union and the states on important issues like tax rates, exemptions, threshold limits, dispute resolution modalities, among others.
  • Central taxes like central excise duty, additional excise duties, service tax, additional customs duty and special additional duty of customs, etc. will be subsumed in GST.
  • At the state level, taxes like vat/sales tax, central sales tax, entertainment tax, octroi and entry tax, purchase tax and luxury tax, etc. would be subsumed in GST.
  • All goods and services, except alcoholic liquor for human consumption, will be brought under the purview of GST. Petroleum and petroleum products have also been constitutionally brought under GST. However, it has also been provided that petroleum and petroleum products shall not be subject to the levy of GST till notified at a future date on the recommendation of the GST council.
  • Both centre and states would simultaneously levy GST across the value chain.
  • The centre would levy and collect the integrated goods and services tax (IGST) on all inter-state supply of goods and services.
 

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