The council will also decide the exemption limit for small traders.States are in favour of ’10 lakh annual turnover, same as that for the value added tax levied by them.Centre favours a higher limit.
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Prime Minister Narendra Modi had on September 14 held a meeting to review the preparedness for the rollout of the GST.
The first meeting of the Goods and Services Tax Council here on Thursday gave an indication that a host of issues remained to be resolved, even as its Chairman and Union Finance Minister Arun Jaitley hoped all pending issues will be thrashed out in due course for a uniform pan-India indirect tax regime to take effect from the targeted date of April 1 next year.
The council will decide on long pending issues of threshold limit for applicability of the tax as well as the limit for dual control between Centre and states.
Already, deciding the threshold for imposing GST is proving to be a tough task, given that states such as Uttar Pradesh, Tamil Nadu and those from the North East believe that keeping units with a turnover of under Rs 25 lakh outside the cap will result in massive revenue loss. “We will continue tomorrow.so that we are able to converge to one particular figure as far as the exemptions are concerned”, Jaitley said.
“The target also involves the passage of CGST and IGST law at the central Parliament and then by the state legislatures the state GST law in the winter session itself”.
Isaac said seven days prior notice has to be given for the meeting, but in an emergency, two days notice was enough.
He said central government officers failed to note they are dealing with state ministers and not their subordinates.
However it was not possible to depute anybody to attend the meeting in place of the Finance Minister, he said. “There is no consensus on the issue”.
However, a consensus on compounding or the composition scheme emerged. “States have clear, strong message just as centre was cordial in receiving the ideas”.
Kerala finance minister Thomas Isaac said his state would lose only 2.5-3 per cent of revenues if the threshold is fixed at Rs 10 lakh and, hence, does not have any problem.
The meeting on Thursday also adopted business rules and procedures.
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The bill has to be ratified by at least 16 of the 29 state assemblies. On the issue of cross-empowerment, several states led by West Bengal want that units with turnover of up to Rs 1.5 crore to be under the exclusive domain of states for audit and collection purposes.
