About GST Council
- Goods & Services Tax Council is a constitutional body under Article 279A of the amended Constitution, for making recommendations to the Union and State Government on issues related to Goods and Service Tax.
- The Council was introduced by the Constitution (One Hundred and First Amendment) Act, 2016.
- The GST Council is chaired by the Union Finance Minister and other members are the Union State Minister of Revenue or Finance and Ministers in-charge of Finance or Taxation of all the States.
Mandate of GST Council
- The Goods and Services Tax Council shall make recommendations to the Union and the States on—
- the taxes, cesses and surcharges levied by the Union, the States and the local bodies which may be subsumed in the goods and services tax;
- the goods and services that may be subjected to, or exempted from the goods and services tax;
- the threshold limit of turnover below which goods and services may be exempted from goods and services tax;
- the rates including floor rates with bands of goods and services tax;
- the date on which the goods and services tax be levied on petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel.
- Quorum: One-half of the total number of Members of the Goods and Services Tax Council shall constitute the quorum at its meetings.
- Voting share: Every decision of the Goods and Services Tax Council shall be taken at a meeting, by a majority of not less than three-fourths of the weighted votes of the members present and voting, in accordance with the following principles, namely: —
- the vote of the Central Government shall have a weightage of one-third of the total votes cast, and
- the votes of all the State Governments taken together shall have a weightage of two-thirds of the total votes cast, in that meeting.
- No act or proceedings of the Goods and Services Tax Council shall be invalid merely by reason of—
- any vacancy in, or any defect in, the constitution of the Council; or
- any defect in the appointment of a person as a Member of the Council; or
- any procedural irregularity of the Council not affecting the merits of the case.
- Dispute adjudication: The Goods and Services Tax Council shall establish a mechanism to adjudicate any dispute
- between the Government of India and one or more States; or
- between the Government of India and any State or States on one side and one or more other States on the other side; or
- between two or more States, arising out of the recommendations of the Council or implementation thereof.
Why in News?
- The forthcoming GST Council is reported to consider taxing petrol, diesel and other petroleum products under the single national GST regime, a move that may require huge compromises by both central and state governments on the taxing these products.
- The Council, which comprises central and state finance ministers, is also likely to consider extending the time for duty relief on COVID-19 essentials.
- When a national GST subsumed central taxes such as excise duty and state levies like VAT on July 1, 2017, five petroleum goods – petrol, diesel, ATF, natural gas and crude oil – were kept out of its purview for the time being.
- This is because both central and state government finances relied heavily on taxes on these products.
- Since GST is a consumption-based tax, bringing petro products under the regime would mean states where these products are sold get the revenue and not ones that currently derive the most benefit out of them because of them being the production centre.
- Simply put, Uttar Pradesh and Bihar with their huge population and a resultant high consumption would get more revenues at the cost of states like Gujarat.