As states meet today to iron out differences over various aspects of the proposed Goods and Services Tax (GST), the Centre said it is hopeful of reaching a common ground on the new indirect tax system.

"Chairman of Empowered Committee is trying (to resolve the issue). I am hopeful that it is possible to have convergence of views," Union Finance Minister Pranab Mukherjee told reporters here.

Also Read   Related Stories News Now - States to meet FM tomorrow on GST - PM urges states to work for GST implementation - Good progress in talks with states on GST: CBEC - Govt gearing up for GST by April 1, 2010 - States agree on dual GST rates - Many states want two GST rates

Also Read   Related Stories News Now - Markets end lower ahead of May F&O expiry - Parsvnath posts Rs 23 cr loss in Q4 - Educomp net down 57% at Rs 61 cr in Jan-Mar qtr - DLF Q4 net plunges 39% to Rs 211 cr - Provogue Q4 net profit down 71% at Rs 1.81 cr More

The states are yet to reach a favourable agreement on certain aspects of GST like rates, items to be covered and issues related to compensation to states that would lose out on their earnings, even as the  April 1, 2010, deadline for the introduction of the proposed tax draws closer.

While states have decided to have two main GST rates, besides one special rate for precious metals, the Centre is yet to take a call on it.

The proposed indirect tax regime would replace most of the indirect tax levied by the Centre like excise and service tax and subsume state-levied taxes like VAT and local taxes like octroi and purchase tax.

However, some states have reservations on doing away with the local taxes as that could impact their financial autonomy.

Also, dearth of data on the services sector with the states is posing problems in fixing the rates for services.

Some states like Madhya Pradesh and Gujarat have said that GST introduction should not be done in a haste.

Gujarat finance minister Saurabh Patel has written to Dasgupta that GST should not be implemented unless there is clarity on subsuming of cesses and surcharges levied by the Centre and on issues pertaining to purchase tax.

The Empowered Committee has also set up a group to suggest changes in the law and model GST legislation as its implementation would require certain constitutional amendments.

The joint working group on GST, that met yesterday, is expected to put forth its recommendations to the Empowered Committee at its meeting today.

New Ipad Application :Business Standard's all new IPad App Click here to download for free Other Stories      - Markets end lower ahead of May F&O expiry - Parsvnath posts Rs 23 cr loss in Q4 - Educomp net down 57% at Rs 61 cr in Jan-Mar qtr - DLF Q4 net plunges 39% to Rs 211 cr - Provogue Q4 net profit down 71% at Rs 1.81 cr

Tags : Goods and Services Tax | indirect tax system | Pranab Mukherjee   Read Business news in  Advertisements -  India's no. 1 Property Site. Click here to know more -  Help a Child Achieve her. Click to know more -  The Best Seller is Also the No. 1 in Mileage. Click here -  Watch The Film Here. Click here to know more.. -  Learn How One City is Running on FOOD SCRAPS. -  1 billion in saving for Unilever without any tangles. -  One Partnership Endless Possibilities. Click here to know more -  Helping doctors detect diseases earlier, saving costs & extending lives. -  Which is the best plan for your daughter -  Check out the TRUE COLOURS of your Stocks, Now for FREE! -  One of the leading business schools in the world.Know More -  2 Lac Apartments, 1 Lac House / Plots. Click here