GST council
Mr Aditya Vikram
Advocate
Visiting Faculty in Bharti College, DU
& IITM college, IP University
GST council is a governing body to regulate and direct each and
every step for the implementation of goods and service tax in
the nation with decisions over tax rates and further
implementation measures. GST council assimilates
suggestions and regulation into one form and improvise the
changes formally through notifications and circulars with its
departments and finance ministry.
According to Article 279A, it is on the part of the president to
give the order to constitute the council of GST within the 60
days from the 12th September 2016 which is already notified
by the Government.
Following are the designated personnel, who will form the GST
Council together:-
• The Union Finance Minister who will be the CHAIRMAN of
the council;
• The Union Minister of State in charge of Revenue or
Finance who will be the MEMBER of council;
• ONE MEMBER from each state who is Minister in charge
of Finance or Taxation or any other Minister and anyone of
them will be VICE CHAIRMAN of the GST Council who will
be mutually elected by them.
Note
• The Secretary of Revenue Department will work as EX-
Officio Secretary to the GST Council,
• The Chairperson of Central Board of Excise and Customs
will be the permanent invitee in all the proceedings of the
GST Council who will not have the voting rights.
Quorum and Decision-Making
• For a valid meeting of the members of GST Council, at
least 50 percent of the total number of the member should
be present at the meeting.
• Every Decision made during the meeting should be
supported by at least 75 percent majority of the weighted
votes of the members who are present and voting at the
meeting. In “article 279A” a principle is there which divides
the total weighted vote cast between Central Government
and State Government:-
o The vote of Central Government shall have the
weighted of one-third of the total votes
o The votes of State Government shall have the
weighted of two third of the total votes, cast in the
meeting
• Any act, decision or proceedings shall not be declared as
invalid on the basis of any remaining deficiency at the time
of establishment of GST Council i.e.
o if there is any vacancy remained in the Council
o if there is any defect in the constitution of Council
o if there is any defect in the appointment of a person
as a member of the Council
o if there is any procedural non-compliance.
Functions of the GST Council
The GST council will be supposed to make the recommendation
to the Union and State on the following matters:-
• On subsuming of various taxes, cess, and surcharge in GST.
• Details of services and goods that will be subjected to GST
or which will be exempted from GST.
• On Threshold limit below which, services and goods will be
exempted from GST.
• On GST rates including floor rate with bands of GST and
any special rate for time being to arrange resources to face
any natural calamity.
• Making special provisions for the following states:
Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur,
Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal
Pradesh and Uttarakhand.
• On model law on GST, Principal of levy of GST and the
principals which will govern the place of Supply.
Features of GST Council
GST Council has the following features –
• The office of the council is located in New Delhi
• The Ex-officio Secretary to the GST Council is the
Revenue Secretary of India
• The Central Board of Excise and Customs (CBEC) is a
chairperson and a permanent, non-voting invitee for all the
meetings of the GST Council
• A post for Additional Secretary to the GST Council would
be created. This post would be equivalent to the level of
the Additional Secretary to the Indian Government.
• At the level of Joint Secretary of the GST Council, four
posts of commissioner would be created in the GST
Council Secretariat
• The GST Council Secretariat would consist of officers on a
deputation basis appointed from the Central as well as the
State Governments
Duties of the GST Council
Besides governing GST implementation in the country, the GST
Council has two major duties to dispose of. These include
making recommendations and holding GST Council meetings.
Let’s understand these duties in details –
GST Council recommendations
According to the provisions laid down under Article 279A (4),
the GST Council has the duty to make recommendations about
GST to the Union Government as well as the State
Governments. The council would decide which goods and
services would be charged to GST and which would be
exempted from it. Thereafter, the GST Council has the duty of
creating laws and principles about the place of supply,
threshold limits, special rates of GST for certain States of India,
the applicable GST rates on various goods and services and
special rates of GST during a natural calamity or a disaster so
that additional resources can be raised for meeting the financial
losses suffered, etc.
GST Council meetings
Another important duty of GST Council is to meet and discuss
about the GST rules and laws which would be beneficial for
dealers. Ever since the GST Council has been formed, various
meetings have taken place. In the last GST Council meeting,
the council decided that GST should be implemented on e-way
bills which require goods valuing more than INR 50,000 being
registered before they are moved. The GST Council also
extended the deadline of filing the GSTR – 1. Anti-profiteering
screening committees were also set up in the latest meeting of
the GST Council. The aim of setting up these committees was
to strengthen the National Anti-Profiteering Authority under the
laws of GST. Besides formulating laws on GST, the GST
Council also took decisions on the following aspects –
• For Indian States, except the special category States, the
threshold limit for exemption of GST would be set at INR
40 lakhs
• In case of special category States, the threshold limit for
exemption of GST is set at INR 10 lakhs
• In case of composition schemes, the threshold limit for
GST exemption is set at INR 1.5 cr for Indian States.
However, for North Eastern States and for Himachal
Pradesh, the threshold limit of GST exemption is set at
INR 50 lakhs
• Goods like tobacco, pan masala, ice cream and other
types of edible ice manufacturers would not be eligible to
avail composition levy. However, in case of restaurant
services, the composition levy would be allowed on these
goods and manufacturing activities.
Dispute handling by the GST Council
The GST Council is also charged with the duty to create a
mechanism with which the following disputes would be settled –
• Disputes between the Central Government and the State
Government of a State
• The disputes between the Central Government and one or
more States on one side and one or more States on the
other side
• Disputes between two or more States which occurred due
to any recommendation of the GST Council or due to the
implementation of the recommendation of the
council.
Who chairs the meetings of GST Council?
The Union Finance Minister of India chairs the meetings of the
GST Council. Currently, the Union Finance Minister is Mr. Arun
Jaitley and as such he is the chairperson of the GST Council
meetings.
Q -What is the attendance criterion for a valid GST Council
meet?
For a GST Council meeting to be valid, at least 50% of the
members of the council should be present at the meeting.
Q -What is the GST Council Secretariat?
GST Council Secretariat is the body which manages the GST
Council. The Secretariat consists of members who are
deputation officers of the Central as well as the State
Governments.
Q -Who bears the cost of managing the GST Council
Secretariat?
The Central Government bears the total cost of managing the
GST Council Secretariat. In the first ever GST Council meeting
which was conducted after establishing the GST Council, the
Union Cabinet allocated sufficient funds for taking care of the
recurring as well as non-recurring expenses of the GST Council
Secretariat.
45th GST Council Meeting
Recently, the 45th Goods and Services Tax (GST) Council meeting was
held.
Key Points
▪ Extension of Concessional GST Rates:
o The Council decided to extend the GST relief on
several drugs related to Covid-19 treatment till
December 2021.
▪ Food Delivery Apps to Collect GST:
o Online food delivery aggregator firms such as
Swiggy and Zomato will now be liable to pay
GST and not the restaurant partners.
• Currently, online bills generated by food
aggregators already have a tax
component in it.
• The taxed amount is paid back to the
restaurant partners who are then
expected to pay this amount to the
government.
▪ Petrol and Diesel will not come under GST Regime:
o The council has decided not to bring petrol and
diesel under the GST
regime. States vehemently opposed the inclusion of
the fuels while raising concerns on revenue
buoyancy during the meet.
• If petrol and diesel come under the GST
regime, prices will become mostly
uniform across all states as the different
excise and VAT rates that the Centre and
the states impose would then be done
away with.
• This would help bring down diesel and
petrol prices greatly, which has touched
new highs in the recent past.
▪ GST on Fortified Rice Reduced:
o The GST rate on fortified rice kernels for schemes
like integrated child development schemes has
been recommended to be reduced from 18% to 5%.
▪ GoM to Look After Rate Rationalisation:
o A Group of state ministers (GoM) will be established
to look after the rate rationalisation related issues
to correct the inverted duty structure and to take
steps to augment revenues.
• An inverted duty structure arises when the
taxes on output or final product is lower
than the taxes on inputs, creating an
inverse accumulation of input tax credit
which in most cases has to be refunded.
• Inverted duty structure has implied a
stream of revenue outflow for the
government prompting the government to
relook the duty structure.
o Other GoMs will be set up in order to look after
issues of e-way bills, FASTAGs, compliances,
technology, plugging of loopholes, composition
schemes etc.
