Before the GST Council’s crucial meeting, Finance Minister Nirmala Sitharaman said in press conference on December 13 that the buzz of a rise in GST rates is everywhere other than her office.
She answered a question about the current GST rates of 5, 12, 18 and 28 per cent being raised to compensate for the decline in revenue that has even held back state compensation for loss of revenue from the implementation of the indirect tax structure.
“The buzz is everywhere other than my office. I don’t know where this is coming from. I have not been to GST Council yet. We have not had any conversation yet. But it’s good to see all this churning outside, it helps to clarify our thought processes,” she said.
Deemed Supply under GST in India
However, Sitharaman did not rule out a hike in GST rates, saying that her ministry still has to apply her mind to it.
“I am saying we as a team have not spoken yet on what we want to go to the GST Council with,” she said. She also said that there is no denying the fact that all states are pending to get GST compensation.
GST Input Tax Credit Refund- Cases, Process, Documents
“No one is denying it is their (states’) right. I fully accept it is their right and I have also given the figures out as to what was the collection, how much was paid in 2017-18, in 2018-19 and up to October 31 and I am also saying that it is an act of faith, cooperative federalism and we shall keep up what has been committed in terms of giving compensation,” she added.
14 Blocked Input Tax Credit (ITC) under GST
States had agreed to surrender the power to collect taxes on goods and services following the subsumption of local tax in the Goods and Services Tax (GST) as of from 1 July 2017. Through legislation, they were guaranteed to be compensated for any loss of revenue in the first five years of implementation of GST.
This monthly payment should be paid within two months, but no such amount has been provided by states till now.
