On June 22, the all-powerful GST Council is set to convene for the first time in eight months following the NDA government's return to power.
There could be some pyrotechnics as well, as states run by the opposition are feeling that the center is becoming weaker in light of the most recent election mandate. A number of significant topics, like as the revision of the tax on online gaming, are being pushed by a vociferous lobby. This is true even though the balance of power continued to move in favor of the BJP and its allies after the saffron party won three states that the Congress had previously controlled: Rajasthan, Chhattisgarh, and Odisha. It also helped its ally TD restore control of Andhra Pradesh. Union FM Nirmala Sitharaman will ask state and union finance ministers in attendance for their comments on the budget for the following month.
Although the meeting's agenda has not yet been finalized, there has been conjecture that the rationalization of tariffs may be brought up again. A panel of ministers led by the then-chief minister of Karnataka, Basavaraj Bommai, had issued suggestions on this matter that were not carried out. Since then, Suresh Khanna, the finance minister for Uttar Pradesh, has assumed the role of panel chairman.
The recently elected president of the industry chamber CII, ITC CMD Sanjiv Puri, stated, "As far as the GST is concerned, what we are saying there can be three slabs and there are areas like petroleum real estate that are outside the ambit... be included in the GST."
In less than two weeks, the indirect tax regime will have been in place for seven years. In response, proposals have been made to lower the number of slabs and modify the rates; the Council had previously delayed making this choice.
"The much anticipated rate rationalization topic will need to be covered in the next GST Council meeting, which will take place after a considerable break from the last meeting. Furthermore, it would be quite advantageous for industry to make a first attempt to incorporate low-impact petroleum goods like natural gas into the GSTambit. The stability of GST revenues combined with the fact that modifications to the GST are not included in the Union Budget recommendations should encourage the GST Council to address a number of pressing concerns, according to M S Mani, a partner at the consultancy company Deloitte India.
Industry justifications for seeking rate rationalization include an inverted duty structure, wherein the end product is subject to reduced levies, and categorization issues.
Many concerns are anticipated to be covered at this discussion. A number of clarifications, such as those on the taxability of ESOPs, corporate guarantee taxability, taxability of the online gambling industry prior to October, and different rate-related clarifications are also expected in light of recent litigations. The new rules regarding input service distributors and their implementation date are another feature that most firms are anticipating, according to KPMG partner and indirect tax head Abhishek Jain.
