Panel on GST headed by Chief Economic Advisor Arvind Subramaniam has submitted its report on GST to Finance Minister. “The country has a historic opportunity with the GST. It will strengthen the country’s tax institutions, get rid of barriers within states and create a common market,” Subramanian said at a press conference.
5 key recommendations from the report are given below:
1. Standard GST rate of 17%-18%, setting the stage for consensus building for this important reforms to get the crucial constitutional amendment passed in the winter session.
2. The standard rate is based on a revenue neutral rate of 15%-15.5%
3. Lower rate of 12%-14% for goods that need to be taxed less.
4. The committee has also suggested removal of 1% levy on inter-state movement
5. The panel has excluded real estate, electricity and alcohol and petroleum products while calculating the tax rate, as some states have expressed reservations over giving up tax control on the lucrative items but the CEA panel suggested these be brought under the GST ambit soon.