The government is working on finalising the contours of GST. It has now decided to have three rates – standard rate, lower merit and a rate for bullion. This pretty much changes the entire architecture of the goods and services tax (GST) as it was envisaged, reports CNBC-TV18’s Aakansha Sethi.
The consensus on GST depends on the finance ministers of Madhya Pradesh and Gujarat because they have been key opponents to it. The GST Bill at this point in time is with the Standing Committee. It is yet to be finalised, and passed in the Parliament for which Bharatiya Janata Party’s (BJP) support is required and then it would be passed by State legislatures where again BJP states will come into play.
However, apart from these two states, there is consensus on the contours of GST and the three rates. Standard rate will be a floor rate with a band of 3 percent. It could vary between 10-12 percent. Keeping 3 percent band means that the effective rate would be anywhere between 13-15 percent. The dispute resolution panel which is currently a part of GST is going to be dropped. States would meet on May 11.