Complex Rate Structure Review
Expectation: A major review of GST’s multiple-rate structure.
Challenge: Progress has been slow due to reluctance to change, especially when revenue is strong. The Council should set a timeline and consider alternative rate structures.
Feasibility of 18% GST on Certain Goods
Expectation: Discussion on revising the 18% GST rate on items like health insurance and life cover.
Challenge: Previous reviews have not led to changes, and further assessment may be needed.
Inclusion of Electricity, Petroleum, and Alcohol
Expectation: Consideration of adding these items to the GST regime.
Challenge: States are resistant to cede more taxation power, and political relations between States and the Centre may be strained.
Monitoring Day-to-Day GST Functioning
Expectation: Improved oversight of GST administration, including refund processes.
Challenge: Uneven refund rates and fluctuating GST receipts require careful monitoring to avoid industry issues and confusion.
Progress of the Ministerial Group (GoM)
Expectation: Review progress made by the GoM appointed in 2021 on GST rate structure.
Challenge: Slow progress and resistance to major changes due to healthy revenue streams.
The Council needs to push for concrete alternatives and a resolution timeline.
COMMENTS