The forthcoming Budget, the last full one before the 2019 Lok Sabha elections, is expected to contain a number of sops and feel-good announcements, especially regarding social sector schemes.
The change in the peak rate will not alter the 4-slab rate structure of 5, 12, 18 and 28 per cent agreed upon last year, but is only a provision being built into the model law to take care of contingencies in future, two officials in the know told PTI.
Since the legal changes in the draft laws would take some time, it was decided to postpone the November 25 meeting
States should have enough time. We still do not know the rules. There are a lot of operational difficulties, says Jammu and Kashmir Finance Minister Haseeb Drabu.
Know what terms like anti-profiteering, CGST, SGST, IGST means in the new regime
Experts said if the slowdown, and subsequent weakness in GST mobilisation, continued, it would curtail the Centre's resources to a considerable extent in the current financial year.
The collections stood at Rs 98,202 crore in the month, against Rs 1.02 trillion in July. The figures indicate continuation of economic slow down which was reflected in the gross domestic product (GDP) growth which plummeted to a 25-quarter low of 5 per cent in the first quarter of 2019-20, experts said.
After 17 tumultuous years, a nationwide Goods and Services Tax (GST) will rollout from midnight of June 30, overhauling India's convoluted indirect taxation system and unifying the $2 trillion economy with 1.3 billion people into a single market.
Many states are open to the idea of petrol and diesel being brought under the goods and services tax (GST) regime - contrary to the perception that they are averse to it - but they want a concrete proposal, including a compensation mechanism, from the Centre. West Bengal Finance Minister Amit Mitra says while the issue can be discussed, the Centre may not be keen to bring the change because it earns "much more" from taxes on petrol and diesel. "(The peak rate of) GST is 28 per cent. Under the regime, the Centre would only get 14 per cent. "So, definitely, the Union government does not want GST on fuel. It is all lies. Currently, they are in a very cozy place," Mitra said.
So far, 38.38 lakh taxpayers accounting for 64.42 per cent of the total businesses, who had registered in July, filed returns.
With recent rate cuts, November collections could be even less
The Centre is likely to introduce the Central GST and integrated GST bills in late November or early December in the ongoing session in the form of money Bills.
Although the June collections were higher than that in July, however, it is important to note that during the previous month, a large number of taxpayers also paid taxes pertaining to February, March and April 2020 on account of the relief provided due to COVID-19.
The direct tax collections are likely to fall short of the revised Budget target by Rs 650 billion and, in fact, were Rs 150 billion lower than the original estimate for the fiscal
The high court's order, which says refunds paid on service inputs can be restricted, runs contrary to Gujarat HC verdict and could complicate matters.
GST is levied on every transaction in the supply of goods and services, barring certain exempted items
The Supreme Court Monday said the Centre was testing its "patience" and "emasculating" tribunals by not appointing officials to the quasi-judicial bodies which are facing severe crunch of presiding officers as well as judicial and technical members and sought action on the matter by September 13.
After the government sought Parliament's nod for a second batch of supplementary demand for grants that will cause a hit of Rs 2.99 trillion to the exchequer, doubts suddenly arose about the government's ability to meet the Budget projections of reining in its fiscal deficit at 6.8 per cent of gross domestic product (GDP), or Rs 15.06 trillion, for the current financial year. Till now, many were of the opinion that the government would succeed in checking the deficit at a much lower figure than what was given in the Budget Estimates (BE). The government had sought Parliament's approval to spend Rs 3.74 trillion extra, but Rs 74,517.01 crore will be matched by equal savings on other heads.
The instruction is that audit of large units be completed within seven working days, of medium units in five working days and of small ones in three.
As much as Rs 6,696 crore has been released to the states as GST compensation for the month of March 2018, as on May 29.
The budgeted indirect tax collection target is Rs 9.26 trillion, and the Centre has collected around Rs 5 trillion in the first 8 months. So it needs another Rs 4.2 trn in the last four months
Appearing on Rediff Chat, G Srikanth, partner in GSV Associates, Chartered Accountants, Chennai, and member of the Institute of Cost and Management Accountants, answered readers' queries on the Goods and Services Act.
The buoyancy in the tax revenue of GST reflects the upswing in the economy and better compliance
'The professional or the freelancer needs to pay taxes from his pocket first and then wait for payments from his clients.'
It shows that states would require a compensation to the tune of at least Rs 1.67 trillion in 2024-25, as none of them would be able to achieve a 14 per cent growth every year.
The GST Council also decided that a committee of officers will be constituted to examine the simplification of forms for annual return and reconciliation statement.
Electricity has also been kept out of the GST ambit.
Businesses with more than Rs 10 lakh turnover may end up paying the central goods and services tax, with the Centre not agreeing to states' suggestion of keeping the threshold at Rs 1.5 crore.
Compliance requirements, valuation, input tax credit transfers are likely to lead to tax litigation, says Sayan Ghosal.
Even with the possible expenditure roll-overs and off-budget financing, the fiscal deficit target will not be met. The FRBM Act, after its amendment in 2018, allows a fiscal deficit slippage of not more than 0.5 per cent for any given year, provided there are justifications. These justifications include war, national security, severe collapse in the agriculture sector, a major natural calamity, big structural economic reforms, or the decline in real output growth of a quarter by at least 3 percentage points below its average of the previous four quarters.
The council, headed by Finance Minister Arun Jaitley, will meet again on December 11 and 12 to hammer out the differences.
It is doubtful that our political masters are even aware of the features of the Model Law.
Higher reliance on GST receipts for revenue reduces states' autonomy as these receipts depend on tax rates decided by the GST Council, a report by Delhi-based non-profit, PRS Legislative Research shows.
For the sake of transparency, and to reduce undesirable bond market volatility, clarity on these would be welcome, preferably before the budgets for the next fiscal year get finalised, says Neelkanth Mishra.
Nasscom president said moving from single to multiple points could be a challenge from the point of view of ease of doing business
Facing a deepening slowdown, the auto sector is pinning hopes on the GST Council meeting on September 20 for a rate cut from 28 per cent to 18 per cent. However, states including Bihar, West Bengal, Kerala, and Punjab are of the view that the slowdown in the auto sector is not because of the GST rate but structural issues in the economy.
Continued lack of consensus at next meeting could cast shadow on GST rollout by April 1.
In a set of FAQs on applicability of Goods and Services Tax on banking, insurance and stock brokers sectors, the revenue department has clarified that transactions relating to securitisation, derivatives, future and forward contracts are exempt.
The passage of the bill will pave the way for setting up of a GST council that will decide the tax rate, cess and surcharges.
For the first eight months of the current financial year, the figure stood at Rs 7.17 trillion.
© 2026 Rediff.com - Investor Information - Advertise with us - Disclaimer - Privacy Policy - Sitemap - Feedback - About us - Terms of use - Grievances