Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: cpt :: due date for vat payment :: ACCOUNTING STANDARDS :: ACCOUNTING STANDARD :: articles on VAT and GST in India :: Central Excise rule to resale the machines to a new company :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: VAT RATES :: TAX RATES - GOODS TAXABLE @ 4% :: list of goods taxed at 4% :: TDS :: VAT Audit :: empanelment :: form 3cd
« Service Tax »
 Service tax officials transferred for favouring realtor
 GST, a challenge and opportunity for accounting professionals’
 Service Tax On Hotels And Restaurants – Recent Delhi High Court Judgment
 GST Council discusses 4-tier tax rate, cess on demerit goods
 Why you shouldn’t miss these three simple tax saving options beyond Section 80C
 Determination of value for transactions between the Related parties under GST Laws.
 Higher collections can offset GST losses
 GST to subsume over a dozen Central, State taxes
 Incidence of indirect taxes won't go up under GST
 Advanced Budget date: Absence of a GST rate may present estimation challenges
  Tax queries answered by Dilip Lakhani, Senior Chartered Accountant

Panel suggests 16 slabs for goods and services tax
November, 14th 2014

A National Institute of Public Finance and Policy (NIPFP) team tasked with recommending a revenue neutral level for the goods and services tax (GST) has suggested as many as 16 rates, corresponding to different scenarios.

The final decision on the tax rate will be taken by the GST Council, to be constituted after the passage of a Constitutional Amendment Bill, said two government officials familiar with the deliberations on the issue. A constitutional amendment bull to introduce GST, introduced by the previous government, proposes the creation of a GST Council consisting of the union finance minister, state finance ministers, and the minister of state for revenue.

Apanel of state government ministers, known as the empowered committee, has tasked a sub-committee, consisting of central and state government officials, with devising the GST tax rate. The subcommittee is processing the NIPFP report in order to arrive at a revenue-neutral rate, the tax percentage at which there is no loss to the centre and the states after the switch to the new regime.

"There are as many as 16 scenarios in the report. These include a three rate GST, four rate GST, two rate GST, subsuming and excluding different taxes such as entry tax and central sales tax as also items such as petroleum, sugar and textiles," said an official adding that the report has been sent back by the sub-committee to NIPFP for reworking it as per latest revenue numbers available for 2012-13 or 2013-14.

This is the second report by NIPFP on the matter. It had carried out a study last year as well. The rates suggested in the latest study are 14%, 16%, 20%, 24% and 27%, marginally different from the numbers thrown by the previous one. "The empowered committee (of state government finance ministers) did not discuss the report or the rates at the meeting on Tuesday." the official said.The revenue neutral rate indicated by NIPFP in both its reports is based on tax collections in 2011-12.

At present, services are taxed by the Centre at the rate of 12% (plus cesses), goods at a standard rate of 12% (plus cesses) and concessional rate of 6%.

States have concessional rate ranging from 4-6% and standard rate ranging from 12.5% to 14.5%. There are other levies such as central sales tax, levied at the rate of 2%, that applies on sale of goods from one state to another and entry tax. The combined incidence of tax including excise, VAT and CST comes to 26.5%-28.5%.

The figure of 27% is at the midpoint of this range and a number of media reports said this had been accepted by the sub -committee of officials working on the revenue neutral rate. In a press release issued on Wednesday, industry body FICCI said a 27% rate will cripple trade and industry.

The general thinking is to have a separate rate of 1% or lower for bullion, a list of exempted items, a concessional rate and a standard rate. The GST council will decide on rates depending on the structure accepted by states and Centre and elements brought within the ambit of the GST.

Tax experts are pitching for a unified rate—identical for services and goods but also a reasonable rate for taxation of services to ensure compliance.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Multi-level Marketing MLM India Affiliate Marketing Affiliate Marketing Software MLM Software MLM Solutions Multi level marketing solutions MLM Servi

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions