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Cabinet clears GST supplementary legislations

Press Trust of India  |  New Delhi 

The Cabinet today cleared four supporting legislations, paving the way for their introduction in as early as today.

The four supporting legislations -- the Compensation Law, the Central-(C-GST), Integrated-(I-GST) and Union Territory-(UT-GST)-- would be introduced as Money Bill, sources said.

"The legislations have been cleared by the Cabinet. These would be introduced in this week, could be even today," a source said.

The legislations were the only agenda in today's meeting of the Union Cabinet, chaired by Prime Minister Modi.

Sources said the four legislations would be taken up for discussion together in Once approved by Parliament, the states would start taking their SGST bill for discussion and passage in the respective state assemblies.

The Council, in its previous two meetings, had given approval to the four legislations as also the State-(S-GST) bill. While the S-has to be passed by each of the state legislative assemblies, the four other laws have to be approved by

Passage of all the legislations would pave the way for introduction of Goods and Services Tax (GST) from July 1.

The government is hoping the C-GST, I-GST, UT-and the Compensation laws will be approved in the current session of and the S-by each of the state legislatures soon.

While a composite will be levied on sale of goods or rendering of services after the new indirect tax regime is rolled out, the revenue would be split between the Centre and the states in almost equal proportion.

This is because central taxes like excise and service tax and state levies like VAT will be subsumed in the

While the C-will give powers to the Centre to levy on goods and services after Union levies like excise and service tax are subsumed, the I-is to be levied on inter-state supplies.

The S-will allow states to levy the tax after VAT and other state levies are subsumed in the The UT-will also go to for approval.

The Council has already finalised a four-tier tax structure of 5, 12, 18 and 28 per cent, but the model has kept the peak rate at 40 per cent (20 per cent to be levied by the Centre and an equal amount by the states) to obviate the need for approaching for any change in rates in future.

Similarly, the cess to be levied on top of peak rate on selected demerit goods like luxury cars for creation of a corpus that will be used for compensating states for any loss of revenue from implementation in the first five years, has been capped at 15 per cent.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, March 20 2017. 11:32 IST