New Delhi: The rollout of the Goods and Services Tax (GST), which will be one of the biggest tax reforms seen by the country since Independence, has been deferred to July 1 from the proposed April 1. The Centre and the states on Monday reached a consensus on most of the controversial issues including dual control and taxation in the high seas making way for the GST roll out in the country. Finance minister Arun Jaitley said, after the GST Council meeting, that implementation of GST from July 1 is “more realistic” than from April 1.
GST Council to meet on February 18
During the 9th meeting of the GST Council, a high level forum of the Centre and all the states, a consensus was reached on how tax payers will be split for audit.
As per the agreement the states will have the power to assess and administer 90 per cent of the tax payers with less than Rs 1.5 crore annual turnover while the remaining would be controlled by the Centre.
However, intelligence based enforcement power will be with both the Centre and states. For tax- payers with more than Rs 1.5 crore turnover, the states and the Centre will control and administer them in a 50:50 ratio.
Mr Jaitley said each assessee will be assessed by only one authority. The states would also have the powers to levy tax on economic activity within 12 nautical miles of territorial waters even though such rights constitutionally vest with the Centre.
The power of audit of tax-payers and taxation in the high seas was holding up a consensus on GST. Mr Jaitley said the power to levy and collect Integrated-GST, a tax on inter-state movement of goods and services, will lie with the Centre but by special provisions in law, the states will also be cross-empowered.
The Council will now meet on February 18 to approve the drafts of the IGST law and other supporting legislations needed for subsuming central and state levies like excise duty and service tax and VAT.
Meanwhile, Amit Mitra said he dissented at the Council meeting as his state government wanted 100 per cent of the tax payers up to Rs 1.5 crore turnover to be with the states.
He termed 90 per cent of the assessees being with states as a victory to protect small traders. As per the agreement reached earlier, businesses earning upto `20 lakh in a year will be exempt from GST. For the North-eastern states this limit will be Rs 10 lakh....