Finance Commission panel recommends single GST of 12%

The 13th Finance Commission task force on the proposed Goods and Services Tax has recommended a single, 12 per cent rate on all items and suggested deferring implementation of the new tax regime by six months from April to October next year.

Out of the GST of 12 per cent, states should receive seven per cent while the rest five per cent should go to the Centre's kitty, said the task force.

The recommendations, however, are at variance with the Discussion Paper prepared by the Empowered Committee of State Finance Ministers which had suggested four rates, including a separate category for exempt items.

The government has planned to introduce the GST, which will replace excise duty and service tax at the Central level and Value Added Tax at the state level, besides the cess, surcharges and local taxes being levied on good and services, from April 1, 2010.

The task force has said the GST be introduced from October 1, 2010.

The Empowered Committee, which is yet to take a final call on GST tax rates, is meeting here under the chairmanship of Asim Dasgupta.

"It (GST) will have four slabs. I hope the rates will be released in the next 15 days," Dasgupta had said.