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Decision on profiteering, lottery tax tmrw

Anjana Das, New Delhi
17/06/2017   0 Comments

The GST Council headed by Finance Minister Arun Jaitley will meet tomorrw to clear the remaining rules and finalise the crucial anti-profiteering rules , e-way bills and tax on lotteries.
The 17th GST Council meeting will also review the preparedness of the states to switch over to the new tax regime that proposes one sales tax for the whole country .
The one day Meeting will also be attended among others by the Finance Ministers of different States and UTs (having elected assembly) being the members of the GST Council. 
Main agenda items of the 17th GST Council Meeting include confirmation of the minutes of the 16th GST Council meeting held on 11th June, 2017, approval of draft GST Rules and related Forms for -- Advance Ruling, Appeals and Revision, Assessment and Audit, E-Way Bill & Anti-Profiteering, and Fitment/adjustment of  GST Rates on certain items among others.
So far  rates of more than 1200 goods and 500 services have been fixed. In its last meeting on June 11, the Council reduced tax rates on 66 items including ketchup, instant food mixes, pickles, tractor components, computer printers and insulin.
Rules related to anti-profiteering will also be taken up in tomorrow meeting . The ‘anti-profiteering’ clause has been provided in the Centre GST (CGST) and State GST (SGST) laws  so that the traders pass on the benefit of reduced tax incidence on goods or services to the consumers and do not take profit out of it.
And this will be done by setting up a framework  to ensure that companies don't arbitrarily raise prices of goods just before or after the implementation of GST from July 1.
Anti-profiteering body is important as  Centre has stated that the overall impact of new tax rates is non-inflationary and the body will be keep a check on rise in price by unfair means. In fact Revenue Secretary Hasmukh Adhia had  warned the traders and businesses not to raise the prices of commodities before GST is rolled out.
In the next meeting the structure of the authority in case of profiteering that would carry on investigations and impose penalty would also emerge.
The Council has already finalised tax rates on almost all goods and services in the bracket of 5, 12, 18 and 28 per cent. It had last  month fixed 43 per cent tax (28 per cent GST plus 15 per cent cess) on hybrid cars which the industry says was too high and the GST rate of 18% in telecom services also has been opposed by the telcos citing their poor financial positions. The Council may review rates on some items. Although on hybrid cars , Finance Minister has already indicated that there would be no reduction.
On the  crucial e-way bill rules which are expected to be finalised tomorrow, it would be clear if  the GST Network (GSTN)  alone would be developing the platform for it or National Informatics Centre (NIC) would be the developer. Sources said it might be NIC which would be entrusted with e-way bills. 
In April, the Council had set in motion the draft e- way bill rules that mandated for any movement of goods, within or outside the state, having value of more than Rs 50,000 to be registered with the GST-Network (GSTN) website. 
As per the draft, it is GSTN that would generate e-way e-way bills valid for 1-15 days, depending on distance to be travelled -- one day for 100 km and 15 days for more than 1,000 km transit. The tax officials can inspect the 'e-way bill' anytime during the transit to check tax evasion. 
But Industry has expressed concerns over Rs 50,000 limit saying it was too low and that the timeline for completion of transport operation was impractical.
Meanwhile, the GST Council also has to finalise the tax rate on lottery as a number of States like Kerala, Sikkim and Maharashtra earning significant revenue from lottery, official sources said  it is likely to be put in the 28% slab keeping in mind it is mostly an item that does not fall under the rest three tax slab category. It could also attract a separate cess and the option to put another cess could be there with the states.


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