'Broad understanding with states on GST'

The Government said Tuesday that it has reached an understanding with the states governments on Goods and Services Tax (GST) which should be implemented from April 1, 2016.

"There has been broad agreement on most issues related to GST with the states in the recent months and the GST rollout is scheduled on April 1, 2016," Minister of State for Finance Jayant Sinha informed the Rajya Sabha.

He said the government has assured states of compensation for any revenue losses for a period of three years, incurred by them from the date of introduction of GST.

"The tax rate under GST may be nominal or zero rated for the time being. This has been proposed to insulate the revenues of the states from the impact of GST, with the expectation that in due course, GST will be levied on petroleum and petroleum products," Sinha said.

GST is envisaged to absorb the indirect taxes including excise duty and service tax at the central level and state-based value added tax and levies.