The new six-member GoM on rate rationalisation, constituted on July 2, 2024, is expected to hold its first meeting soon, ahead of the 54th GST Council gathering likely in the third- week of August.

Central and state government officials have started discussions on rationalising the Goods and Services Tax, with sources telling Business Today TV that a three-tier   rate structure is also among the options on the table.

This would imply three slabs of either 8 percent, 16 percent and 24 percent rates, or 9 percent, 18 percent and 27 percent. Both options include provisions for the abatement of goods of basic necessity and differential treatment for sin goods like cigarettes, tobacco, and pan masala.

“We are at discussion stage. The final recommendations would go to the Group of ministers (GoM) on rate rationalisation,” said a government official.

Business Today TV is awaiting replies to queries sent to the Ministry of Finance and the GST Secretariat and the details will be updated once made available.

The new six-member GoM on rate rationalisation, constituted on July 2, 2024, is headed by Samrat Chaudhary, Deputy Chief Minister of Bihar, as the convener. Other members are Suresh Khanna, Minister for Finance, Uttar Pradesh; Gajendra Singh, Minister of Medical and Health Services; Chandrima Bhattacharya, Minister of Finance, West Bengal; Krishna Gowda, Minister of Revenue, Karnataka; and KN Balagopal, Minister of Finance, Kerala. 

This group is expected to hold its first meeting soon, ahead of the 54th GST Council gathering likely in the third-week of August.

During a post-budget roundtable with Business Today TV, CBIC Chairman, Sanjay Kumar Agarwal said, “the group of ministers committee is looking into this matter. GST rates and commodities need to be matched with the right rate. A second exercise could be having special rates for special commodities. The committee will look into if there is a need of four rate slabs or simplify it further”.

After the meeting of the GST Council last June, Union Finance Minister Nirmala Sitharaman had said, “the GoM on rate rationalisation has done substantial work. We will give time to the new GoM to study and revise all the recent updates. In the next meeting, they will present a status report and we will begin discussions on rationalisation”.

Source: Business Today