Model GST Law to be finalised by February end

The Dollar Business Bureau

Model Goods and Services Tax (GST) law, which is presently being examined by the department of law, is likely to be finalised by the end of this month, said a senior official from the Finance Ministry. The model law will set the path for rolling out of the GST from July 1, 2017.

“We are very close to finalisation of law. The Model law will be finalised by the end of this month. Currently, Model CGST and SGST law are being vetted by the law ministry, and these will be taken before the GST Council meeting on February 18, said Ram Tirath, Member, Central Board of Indirect Taxes.

In the second leg of Budget session, which is starting from March 9, the Model GST laws that include IGST are likely to be tabled before the Parliament.

While the Central GST (CGST) will include central sales tax, central taxes of excise and service tax, Integrated GST (IGST) is to be levied on the goods and services movement from one state to other.

On the other hand, the states will have to approve the State Goods and Service Tax (SGST). In addition, a GST Compensation Act required to be passed in the Parliament to make for compensation to the states which lose revenue due to the implementation of GST in initial five years.

Though the GST Council has already taken the decision on a four-tier structure for taxing for the indirect tax regime, the rate for various goods and services will be decided in May or June. The Council has decided the rates for four-slab structure at 5%, 12%, 18% and 28%.