he principal discussion and debate relating to the introduction of Goods and Services Tax in India was about whether the single unified GST was the appropriate model or whether the dual GST was the more feasible and 'doable.' In this regard, the announcement that was made sometime ago by the Empowered Committee of State Finance Ministers was that it had accepted the recommendation a dual GST that was made by the Working Group it had set up. The report of the Empowered Committee on GST has been forwarded to the finance ministry for consideration.
Software for multiple blog management.
The ministry has, in turn, forwarded it to the 13th Finance Commission to study and analyse the recommendations from a federalist standpoint and, in particular, from the point of protecting and ensuring the buoyancy of revenues of both the Centre and the states. The Finance Commission has, as a part of its brief, started engaging with the chambers of commerce and selective trade associations to ascertain their views and identify challenges and concerns with regard to the chosen model of GST. It is also looking at global best practices in this regard.  Now, the central irony of the whole debate is that while the contours of the dual GST model are known in parts, as a result of the public interactions that the chairman of the Empowered Committee has had, the report of its Working Group is not released to the public. Hence, the recommendations are not known in full and thus the interactions of the Finance Commission with the above stakeholders is with regard to a GST model whose full details are not known to the public! Further, it could well be that the Finance Commission could recommend a materially different GST! Nevertheless, on the 'how' of the GST, it seems clear that the recommended dual GST will have a federal part and a state part. Further, the federal and state GST will both consist of a goods tax and a tax on services. Thus, both taxes will apply to goods and services. Further, the federal GST and the state GST will consist of multiple rates insofar as they relate to goods, and will comprise a single rate insofar as they relate to services. Full input tax credits would be available in regard to the federal GST and the state GST. The two taxes will operate in parallel and throughout the supply chain. What is therefore required to be determined is the taxable event which gives rise to the two taxes.
Full Story:
India's GST woes
