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Centre Proposes 4 GST Slabs

The Goods and Services Tax (GST) Council on 18 October 2016 reached a consensus on the way the states would be compensated for any loss of revenue after implementation of the new indirect tax regime, GST from 1 April 2017.
●    During the meet, the GST Council also discussed the possible GST rates, including a four-slab structure of 6, 12, 18 and 26 with lower rates for essential items and highest band for luxury goods.
●    The three-day GST council meet was headed by Finance Minister Arun Jaitley and included representatives from all states. 
●    Base year for calculating the revenue of a state would be 2015-16
●    Secular growth rate of 14 per cent would be taken for calculating the likely revenue of each state in the first five years of implementation of the GST.
●    States getting lower revenue would be compensated by the Centre.
●    They reached at a consensus on definition of revenue to compensate states for revenue loss due to GST implementation.

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