Goods and Services Tax (GST) Posted on : 31-03-2017 | Back | Print
On 29 March, 2017, the historic Goods and Services Tax (GST) regime came a step closer to meet its July 1 target of roll out, with the Lok Sabha approving four supplementary legislations- The Central GST Bill, 2017; The Integrated GST Bill, 2017; The GST (Compensation to States) Bill, 2017; and The Union Territory GST Bill, 2017. The passage of the four laws is a "historic milestone in the economic history of our country".
As the biggest taxation reform since Independence, GST will subsume central excise, service tax, VAT and other local levies to create a uniform market. GST is expected to boost GDP growth by about 2% and check tax evasion.
The GST Council has recommended a four-tier tax structure -- 5, 12, 18 and 28%. A cess will be imposed on luxury and demerit goods to compensate the States for revenue loss in the first 5 years of GST implementation. Sovereignty would be shared between the Centre and the States. Shri Arun Jaitley, Finance Minister, stated that taxation powers would continue to be with the State legislatures and would be used on the recommendations of the GST Council.
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