Taking yet another step towards implementing a new indirect tax regime, the Goods and Services Tax (GST) Council — headed by Finance Minister Arun Jaitley — on Thursday cleared the draft state GST (SGST) and Union Territory GST (UGST) bills.
The Council had on 4 March approved the central GST (CGST) and integrated GST (IGST) bills.
The central, Union Territory, integrated and compensation draft bills, will now go to the Union Cabinet for approval. According to an official, after getting the Cabinet nod, the bills are likely to be tabled together in Parliament by 22-25 March during the ongoing Budget session. State GST bill will go to each of the state legislatures for clearance.
The government plans to roll out the new tax regime by 1 July 2017.
In its next meeting, the GST council is likely to take a decision on rates for individual items. In November 2016, the council had decided a four-tier rate structure for GST of 5 percent, 12 percent, 16 percent and 28 percent. A cess, over and above the highest rate, will be levied on demerit or ‘sin’ goods like tobacco, pan masala and luxury cars. The cess will be capped at 15 percent, said Delhi Deputy Chief Minister Manish Sisodia after the meeting.
Last month, the GST Council cleared the draft compensation law, under which, the Centre will have to fully compensate states for any revenue loss for the first five years after migrating to the new tax regime.