Duties on alcohol, petro products to be examined

After duty cut on imported wine, beer and spirits, the joint working group on Goods and Services Tax (GST) has been asked to recommend a new duty structure on alcohol and petroleum products besides other non-value added tax (VAT) items and exempted goods and services.

"The working group on GST will consider how exempted goods and services and non-VAT items such as alcohol and petroleum products might be treated under the GST regime, scheduled to be implemented from April 1, 2010," a senior finance ministry official said.

The group, which is meeting here tomorrow, is likely to submit a report on the GST framework within four months to the empowered committee of state finance ministers.

The panel, which comprises Adviser to Finance Minister Parthasarathi Shome and state finance secretaries, has been asked to work out a model and recommend the division of power for levy, collection, and appropriation of revenue between the Centre and the states.

The group has been asked to keep the interests of north-eastern states, agriculture, consumers, trade and industry in mind while making its recommendations.

"The panel has been asked to design GST in such a way that it is revenue fair, ensuring sufficient growth of revenue to the Centre and states," said the official.

Finance Minister P Chidambaram had earlier said that empowered committee of state finance ministers, which had successfully implemented VAT, will work in co-ordination with the Centre to implement GST from April 1, 2010.

The GST panel is also expected to recommend models which ensure avoidance of double taxation and ensure that the suggested model takes into account problems faced during inter-state transactions.