While several important issues, including review of the tax on online gaming, pushed by a vocal lobby, may be on the agenda, there may be some fireworks too, given that Opposition-ruled states are sensing a weaker Centre after the latest election mandate.This is despite the scales tilting further in favour of BJP and its allies after the saffron party swept to power in three states ruled by Congress – Rajasthan, Chhattisgarh and Odisha – and its ally TDP regaining control of Andhra Pradesh. With finance ministers from states and UTs in town, Union FM Nirmala Sitharaman will also seek their inputs for next month’s Budget.
While the agenda for the meeting is yet to be finalised, there is speculation around rationalisation of rates coming back on the table, an issue on which a group of ministers under then Karnataka CM Basavaraj Bommai had made some recommendations, which were not implemented. Since then Uttar Pradesh finance minister Suresh Khanna has become the chairman of the panel.
“As far as 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,” said ITC CMD Sanjiv Puri, the newly elected president of industry chamber CII.
With the indirect tax regime completing seven years in a little over a fortnight, there have been calls to reduce the number of slabs and also rejig the rates, a decision that the Council had postponed.
“The next GST Council meeting comes after a significant interval from the last meeting and will need to take up the keenly awaited rate rationalisation discussion. In addition, a preliminary effort to include low impact petroleum products, such as natural gas, within the GST ambit would be highly beneficial to business. The stability established in GST collections together with the fact that GST changes are outside the Union Budget proposals should provide an impetus to the GST Council in addressing various issues that need to be addressed,” said M S Mani, partner at consulting firm Deloitte India.
Industry has cited inverted duty structure, with the final product attracting lower levies, as well as classification problems to seek rationalisation of rates.
“This meeting is expected to address a considerable number of issues. Multiple clarifications are being looked after to including taxability for the online gaming sector before October, taxability of ESOPs, corporate guarantee taxability, and various rate-related clarifications are also anticipated due to recent litigations. Another aspect which most businesses are looking forward to is the new regulations on Input Service Distributor and its implementation date,” said Abhishek Jain, indirect tax head and partner at KPMG.
