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Business News/ Politics / Policy/  Arun Jaitley, officials brief Narendra Modi on GST roll-out preparation
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Arun Jaitley, officials brief Narendra Modi on GST roll-out preparation

According to officials, Modi sought an update on the revenue neutral rate, information technology backbone for GST and concerns of the states

The first meeting of the goods and services tax (GST) council will be held on 22-23 September. Photo: Pradeep Gaur/MintPremium
The first meeting of the goods and services tax (GST) council will be held on 22-23 September. Photo: Pradeep Gaur/Mint

New Delhi: Prime Minister Narendra Modi on Wednesday reviewed preparations for the roll-out of the goods and services tax (GST) regime, possibly from 1 April 2017, with finance minister Arun Jaitley and his team making a presentation on the milestones achieved and the road ahead.

Jaitley along with finance secretary Ashok Lavasa and revenue secretary Hasmukh Adhia made a presentation to Modi on the state of readiness for creating the GST framework—India’s biggest tax reform since independence.

The presentation came within days of the cabinet approving setting up of the powerful GST council, which will decide on the tax rate, exempted goods and the threshold.

People familiar with the matter said that besides listing milestones achieved so far, the presentation detailed the steps to follow including the timetable to get the supporting legislations approved.

They said Modi wanted to understand the main areas where he should focus. He also wanted an update on the revenue neutral rate, information technology backbone being developed and concerns of the states, the people said.

The first meeting of the GST council, which will be headed by finance minister, will be held on 22-23 September, and the panel is to give its recommendations on the tax rate and other provisions within 60 days.

The prime minister was also briefed about the widespread demand for keeping GST rate at 18-19%, expectations of the states from the new regime and the impact of different tax slabs on the centre in terms of compensation it has to pay the states for loss of revenue.

The government is keen to implement the new tax regime from 1 April to ensure a smooth rollover to the changed tax structure from the beginning of the new fiscal, and avoid mid-year alterations.

People familiar with the matter said GST implementation is running ahead of schedule, with more than the anticipated number of states ratifying the constitutional amendment within the 30-day timeline set by the centre.

The focus now shifts to creating the IT infrastructure and preparing traders, businessmen and companies to smoothly shift to the new taxation regime that will subsume an array of central and state levies, including central excise duty, service tax, value-added and entry tax.

The supporting legislations—central GST and integrated GST—which detail the tax rates and exempted goods and bands are planned to be approved in the winter session of Parliament in November, the people said.

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Published: 14 Sep 2016, 09:45 PM IST
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