GST Council Gives Nod To State GST and UTGST Laws

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Taking yet another step towards implementing a new indirect tax regime, the Goods and Services Tax (GST) Council – headed by Finance Minister Arun Jaitley – on Thursday cleared the draft State GST (SGST) and Union Territory GST (UTGST) bills.

Final drafts of the three other bills – Integrated GST (IGST), Central GST (CGST) and the Compensation bill – had been cleared by the Council in its previous meetings.

The CGST, UTGST, IGST and Compensation bills will now go to the Union Cabinet for approval, while the SGST Bill will be taken up by the individual state cabinets and assemblies, Jaitley told reporters at the end of the Council meeting. In its next meeting on March 31, the panel will consider supporting GST rules.

After getting the Cabinet nod, the bills are likely to be tabled together in Parliament by March 22-25 during the ongoing Budget session, a government official who did not wish to be named told earlier in the day.

Once the bills are passed, another key meeting to present the slabs for various goods and services before the Council will take place, Jaitley said. July 1 continues to be the tentative date fixed for implementation of the new indirect tax regime, he added.

It would be critical for the government to immediately release the approved GST draft bills along with relevant rules and rate schedules for the industry to adequately assess its final impact and for a smooth transition, Krishan Arora, partner at Grant Thornton India LLP, said in statement.

Clearance of the Model GST Law is a warning bell for those who have not yet commenced their preparations for introduction of GST, said Sachin Menon, national head, indirect tax, KPMG in India in a note. The industry won’t get enough time to prepare if the states don’t pass the GST law latest by second half of April, he said.