47th Meeting of GST Council will be held on June 28 and 29 in Srinagar: FM Sitharaman
The 47th meeting of the GST Council would be place in Srinagar on June 28-29, 2022, according to Union Finance Minister Nirmala Sitharaman.
The GST Council’s 47th meeting would be place in Srinagar on the 28th and 29th of June 2022, according to Union Finance Minister Nirmala Sitharaman.
The GST Council meeting was originally set for April, however it had to be postponed to next month due to FM’s other commitments.
The compensation issue is likely to be discussed at the conference, as many non-BJP states are pushing for a five-year extension of the GST compensation scheme, which expires in June 2022.
Several states are urging the Narendra Modi government to extend a compensation scheme for GST losses, or risk a stalemate in efforts to streamline the structure further. It’s the country’s most major tax reform in decades faces its toughest test yet.
Finance ministers from Kerala, West Bengal, and Chhattisgarh, all led by the opposition, have announced they will raise the issue at a GST Council meeting later this month.
According to a Bloomberg report, Tamil Nadu and Bihar, a state headed by PM Modi’s supporter, will also support the push.
After the Supreme Court declared last month that the GST Council’s judgments are non-binding, states are feeling more confident in taking on the federal government. If the Council, led by the federal finance minister, does not agree, states could earn revenue through various taxes on their own, which would go against an effort to standardise such duties across countries.
“This is not an ego tussle between the center and states,” said TS Singh Deo, finance chief in the mineral-rich Chhattisgarh. “The idea is to ensure increase in revenue and if it doesn’t happen through the council then it will have to be from other avenues. This was supposed to be ‘one nation one tax’ and not ‘one nation one budget.’”
The federal government is required by the GST statute to pay states for giving up their tax-making powers in exchange for their support for the consumption tax for the next five years, until June 2022. During that time, the programme cost $103 billion. Several states want this to continue since it is a critical source of revenue for salaries, subsidies, and infrastructure development.
The BJP and its allies control 17 of India’s 28 states, as well as one of the three federal territories with a legislature. The federal government administers five other provinces directly.
Giving in to official demands might complicate finances at a time when Asia’s third-largest economy is dealing with surging prices as its recovery from the pandemic-induced downturn picks up speed. According to analysts at Nomura Holdings, the government’s $26 billion inflation-fighting plan risks increasing the fiscal deficit for the current year to 6.8% of GDP, up from 6.4 percent.
The states have received GST compensation from the federal government through the end of May, with only the June payment remaining.
Last year, the Council extended the charge that pays state compensation, stating that the money raised will be used to repay the compensation sum borrowed during the pandemic.