The ministerial panel on GST rate rationalization is set to convene on September 25 in Goa to discuss potential adjustments to tax slabs and rates. An official informed PTI that the Group of Ministers (GoM), led by Bihar Deputy Chief Minister Samrat Chaudhary, last met on August 22 and submitted a status report to the GST Council on September 9. During the previous meeting, the panel tasked the fitment committee, consisting of tax officers from both the Centre and the states, with analyzing the implications of any proposed tax rate changes on various items.
Currently, the Goods and Services Tax (GST) operates under a four-tier structure with rates of 5%, 12%, 18%, and 28%. Essential items are either exempt from tax or fall under the lowest slab, while luxury and demerit goods incur the highest rate, along with an additional cess.
Discussions have included the possibility of merging the 12% and 18% slabs, but no formal proposals have been made yet. The average GST rate has dipped below the revenue neutral rate of 15.3%, prompting the need for discussions on rationalization. However, states like West Bengal and Karnataka have expressed opposition to altering the GST slabs at this time. West Bengal Finance Minister Chandrima Bhattacharya stated that no changes should be made, while Karnataka Revenue Minister Krishna Byre Gowda emphasized the need for careful analysis before considering any adjustments to the established GST framework. The six-member GoM also includes Uttar Pradesh Finance Minister Suresh Kumar Khanna, Rajasthan Health Services Minister Gajendra Singh, and Kerala Finance Minister K N Balagopal.
