Finance Ministry sets up GoM for reviewing GST rates, slabs & exemptions
Karnataka – The Finance Ministry of India has established a GoM (group of ministers) that has been assigned with the task of reviewing the current GST slabs along with expanding base post examining goods and services that have been exempted currently. The panel of GoM includes seven members and is chaired by the Chief Minister of Karnataka, Mr. Basavaraj Bommai.
Mr. Bommai has been asked to suggest processes and measures that can be implemented as soon as possible and also those that can be gradually adopted over medium to long periods of time. Another GoM panel has also been set up which will be based on IT tools and data analysis. The second GoM will be headed by Maharashtra Deputy Chief Minister Ajit Pawar. The decision of forming two GoMs was taken last week in Lucknow during the GST council meeting.
GST revamping has been on a high agenda, as was also indicated recently by Finance Minister Nirmala Sitharaman. She said during an interaction with the media that it is time to revise the rate structure. At present, the average GST is estimated around 11.5% against the weighted average rate of about 15%. Sitharaman said that aim of GoM is to look into the inverted duty arrangement. However, notification by the ministry indicates a much wider picture.
Center is seeking on revising the current GST slab and has talked about any options of increasing the slab upwards by 5%b and moving items with 12% and 18% duty charges to 16-17% levy. The proposal however did not gather much support in the 2020 GST Council meeting.
Officials agree on the issue that the current GST structure has become a complicated task to administer and manage. Furthermore, it is also not giving sufficient growth in revenues.
Members of GoM on rate rationalization that is headed by BS Bommai are Tarkishore Prasad of Bihar, Mauvin Godinho of Goa, KN Balagopal of Kerala, SK Dhariwal of Rajasthan, Suresh Khanna of UP, and Amit Mitra of West Bengal.
Ajit Powar headed second GoM’s members are: Manish Sisodia of Delhi, Dushyant Chautala of Haryana, B Rajendranath of AP, Ajanta Neog of Assam, TS Singh Deo of Chhattisgarh, Niranjan Pujari of Odisha, and P Thiaga Rajan of Tamil Nadu.