GST Council Meet: Govt to take call on rate cuts on various items; here's what to expect

The government has announced that the Goods and Service Tax (GST) council meeting will take place on Saturday in order to rationalise the 28 per cent slab by cutting tax rates on various items.

The council may also discuss ways to increase collection and stop tax evasion. (Image: PTI)

GST Council Meeting: The government has announced that the Goods and Service Tax (GST) council meeting will take place on Saturday in order to rationalise the 28 per cent slab by cutting tax rates on various items. It is speculated that the council will cut rates on several items including colour television, motor vehicles, cement and yachts among others. Earlier this week, Prime Minister Narendra Modi informed that the government will impose tax on most items below 18 per cent to reduce pressure under the new indirect tax regime. While speaking at an event in Mumbai, he said, “Today, we are approaching a stage where 99 per cent items can be brought under 18 per cent.” All things related to common man will be 18 per cent or below that 99 per cent articles will be 18 per cent or below 18 per cent rate, PM Modi said further adding that GST should be made as simple and as convenient as possible. Apart from reducing the tax, some other key decisions are also expected to be announced in the meeting. Headed by Union Finance Minister Arun Jaitley along with his state counterparts, the council may take a call on the increase in the turnover threshold for quarterly filing and simplification of the tax refund process. A decision on the revenue position of both Centre and state governments, easing refund-related rules for exporters, is also likely to be on the agenda. The GST Council is the highest decision-making body of the new indirect tax system that came into effect from July 1, 2017. Some industry experts also believe that the Council may also take up the issue of transferring the ownership of IT backbone GST Network in a government-owned company. This proposal was approved in the cabinet in September 2018. Apart from the aforementioned issue, discussions on reducing cess on plug-in hybrid cars, which currently falls in the 28 per cent tax slab, can also take place. However, the overall tax incidence for the green vehicle is 43 per cent right now. As per media reports, even the Road Ministry has proposed to bring down the tax liability to 35 per cent. The council may also discuss ways to increase collection and stop tax evasion. Earlier, the government has maintained that more items would be brought down to 18 per cent or less rate depending upon the revenue it collects.