GST Council meet makes headway towards consensus

The Goods and Services Tax (GST) Council on 22 December, the first day of its ongoing two-day meet, managed to take a major step towards a consensus on the model GST. The council, under the chairmanship of Union Finance Minister Arun Jaitley, has reached a consensus on most of the 197 clauses of the bill with a few tricky issues marked for further discussion.

The council is currently meeting to deliberate over the balance 7 of 27 chapters of the model GST law and also to take a call on the dual control issue. The group today (23 Dec) will consider the key issue of assesee jurisdiction under the GST. The final outcome of this meeting expected later today will be keenly watched by all economic and market observers.

The dual form of GST to be adopted by India calls for distribution of rights between the Centre and state governments. Thus, a resolution on the sharing of administrative control over assesees will be crucial if the government’s target of 1 April, 2017 for GST roll-out is to be achieved.

Either ways, a definitive resolution on the GST will be required before 16 September, 2017 when the current law on indirect taxation will cease to be in force. Also, a successful implementation of the much-anticipated switch-over to GST will be a strong morale booster for the markets that have been languishing under the shadow of demonetisation.