The Union Cabinet on July 29, 2015 approved Rajya Sabha Select Committee amendments on Goods and Services Tax (GST) Constitution Amendment Bill, 2014. The amendments were proposed by Rajya Sabha Select Committee on GST Bill 2014. The Rajya Sabha Select Committee submitted its report on July 22, 2015. Rajya Sabha Select Committee was chaired by Bhupender Yadav. The Bill also called Constitution (122nd Amendment) Bill, 2014 was passed in Lok Sabha on 5 May 2015. Also Read - CBSE & ICSE Board Exams 2021: Top 7 Things to do For Preparation |Watch Video
Highlights of the recommendation of the Select Committee Also Read - CBSE Board Exam 2021: Tips to Cope Up With Stress For Children And Parents | Watch Video
The committee suggested that compensation to the states should be made for 5 years instead of up to 5 years for any revenue loss due to introduction of GST. Also Read - Telangana Schools to Reopen for Classes 6 and 8 After Nearly 11 Months
Additional tax up to 1%: On this, the committee stated that the provision of 1% additional tax is likely to lead to cascading of taxes. Hence, it recommended that the term, supply be explained to mean all forms of supply made for a consideration.
Compensation to States: On this, the committee recommended that compensation would be provided to states for a period of five years
Functions of the GST Council: On this, the committee recommended that the term, bands must be defined to include the range of GST rates, over the floor rate, within which CGST and SGST may be levied on specific goods or services or classes of goods or services
Dispute Resolution: In this, the Committee stated that the creation of a separate dispute settlement authority would hamper the functioning of the GST Council in general and the legislatures in particular.
GST Rates of Banking Services: On this, the committee recommended that the GST rate for the banking industry should be minimum, to ensure international competitiveness. If possible, banking services could be outside the purview of GST.
GST Network (GSTN): The committee noted that the non government shareholding in GSTN is dominated by private banks, and this is not desirable. It recommended that the non government institution shareholding be limited to public sector banks and financial institutions.
About The Constitution (122nd Amendment) (GST) Bill, 2014
The Bill amends the Constitution to introduce the goods and services tax (GST). Parliament and state legislatures will have concurrent powers to make laws on GST. Only the centre may levy an integrated GST (IGST) on the interstate supply of goods and services, and imports. Alcohol for human consumption has been exempted from the purview of GST. GST will apply to five petroleum products at a later date.
The GST Council will recommend rates of tax, period of levy of additional tax, principles of supply, special provisions to certain states etc. The GST Council will consist of the Union Finance Minister, Union Minister of State for Revenue, and state Finance Ministers.
The Bill empowers the centre to impose an additional tax of up to 1%, on the inter-state supply of goods for two years or more. This tax will accrue to states from where the supply originates. Parliament may, by law, provide compensation to states for any loss of revenue from the introduction of GST, up to a five year period.