 "GST Council to meet on Tuesday, decide tax rate by Oct 20")
The crucial three-day meeting of the all-powerful GST Council, that is slated to begin on October 18, will decide on the tax rate and sort out issues like rolling out compensation for the new tax regime that will come to force from April 1, 2017.
With the finance ministry setting November 22 as the deadline for building a consensus on all issues in the Council, the upcoming meeting is significant as it will decide on its most crucial aspect, which is the tax rate that will have a bearing on the common man.
At its previous meeting last month, the GST Council, which has all state finance ministers as members, had finalised area-based exemptions and how 11 states, mostly in the North-East and hilly regions, will be treated under the new tax regime.
Tomorrow's meeting will also deliberate on the Centre's power to assess 11 lakh service tax filers under the new dispensation.
While a decision to this effect was taken at the first meeting of the GST Council, at least two states dithered on approving the minutes of the meeting, saying that they were not in favour of losing their power of assessment.
The finance ministry will try and reach a consensus on key issues so that the subsequent central GST (CGST) and integrated GST (IGST) legislations can be introduced in the month-long Winter Session of the Parliament that will begin on November 16.
Last year, a panel headed by the Chief Economic Advisor, Arvind Subramanian, had suggested a standard rate of 17-18 percent for goods and services in bulk, while recommending 12 percent for low rate goods.
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Another 40 percent rate was suggested for luxury cars, aerated beverages, pan masala and tobacco. For precious metal, it recommended a range of 2-6 percent.
Finance Minister Arun Jaitley had last week said that tax on non-environment-friendly products will be "distinct" from others in the GST framework.
As for the formula for the Centre compensating loss of revenue to states, around three to four alternatives were discussed at the first meet, but a decision could not be reached.