Today Union Cabinet approved four legislations drafts to implement the Goods and Services tax (GST). It will be introduced in the parliament this week and will be applicable from 1st July.
Main agenda for the meeting in the Union Cabinet was GST bill. The Union Cabinet chaired by Prime Minister Narendra Modi has approved the four GST related bills — The Central Goods and Services Tax Bill 2017 (The CGST Bill), The Integrated Goods and Services Tax Bill 2017 (The IGST Bill), The Union Territory Goods and Services Tax Bill 2017 (The UTGST Bill) and The Goods and Services Tax (Compensation to the States) Bill 2017 (The Compensation Bill).
Consent of the bills by Parliament and a separate one by all state assemblies will complete the legislative process in their upcoming sessions for the one-nation-one-tax regime by merging central taxes like excise duty and service tax and state levies like VAT.
The CGST Bill deals with the levy and collection of tax on intra-state supply of goods or services for both by the Central Government
The IGST Bill deals with the levy and collection of tax on inter-state supply of goods or services or both by the Central Government.
The UTGST Bill deals with the levy on the collection of tax on intra-UT supply of goods and services in the Union Territories without the legislature.
The Compensation Bill is for compensation to the states for loss of revenue arising on account of implementation of the goods and services tax for a period of five years.
The GST Council earlier approved four-tier tax slabs of 5, 12, 18 and 28 %. There is an extra tax on demerit goods like luxury cars, aerated drinks, and tobacco products. The work on for categorizing various goods and services in different slabs is slated to begin next month.