GST Council: All you should know about it

. 5 min read
GST Council: All you should know about it

Unlike everybody that needs to implement and govern the rules that are formed, similar is the case GST (Goods and Services Tax). The GST council is the governing body of the law and ensures to keep an eye on the taxation. It also regulates and directs every step that is involved in the implication of Goods and Services Tax. Their major responsibility lies in ensuring the proper functioning of the taxation system in the nation and also participating in decisions over tax rates besides taking part in the implementation of the same.

The GST council is also responsible for other functionalities like GST registration and assimilation of regulation. The council also brings into force, the changes that occur formally through notifications.

GST Council

Now that we know what a GST council is, let’s have an in-depth look into their prospects and functioning.

About GST Council

  • It is a federal body that strives to bring forth a cluster of different states and introduce them to a single platform for the output of CGST and IGST. Providing a singular platform for effective functioning, the GST council serves as one common platform for a nationwide rollout of indirect taxes.
  • It is a leading body that has the powers to modify, reconcile or amend changes to any of the GSTR 7, GSTR 4, GSTR 9 and GSTR 2 among others. It is a body that can amend changes to any of the rules when related to goods and services tax in India.
  • It is the responsible body to announce tax rates, its exemption and also the due dates of GST forms, GSTR, tax laws, and the common deadlines.
  • Its major function is to ensure that the entire country amends and comes under one tax rate for goods and services.

The GST Council will be formed by these following designated personnel:-

  • The Union Minister of Finance who is the dedicated Chairman of the council. The responsibility of the Union Minister of State also plays an important role in setting up of Finance or Revenue who will be the council’s member.
  • Besides having the Union Minister of Finance who is responsible for running the taxation system, one individual member of each state either Minister in charge of Taxation or Finance or any other Minister is entitled to be the GST Council’s Vice Chairman, who is elected manually amongst them.

GST Council’s Formation

The Cabinet Ministry is the ruling body that lies behind the establishment of the GST Council and was also responsible for forming the body on 10th September 2016. Previously, the provisions for the same came into effect on 12th September 2016.

Also, the GST received the Article 279A that led to the provision behind their establishment, was inserted after Article 279 of THE CONSTITUTION ACT (ONE HUNDRED AND FIRST AMENDMENT), 2016. Lastly, Mr. Arun Jaitley, the Minister of Finance is the head of the GST Council.

Let’s wrap up the entire process of creation of GST Council

  • GST Council was formed as per regulation with the amended Constitution’s Article 279A.
  • The GST Council has its office based out of New Delhi
  • The CBEC (Central Board of Excise and Customs) and the responsible Chairperson are the permanent non-voting invitee to all the proceedings that come across the GST Council.
  • The Secretary of Revenue is the GST Council’s Ex-officio Secretary.
  • The Council comprises Additional Secretary’s one post besides Commissioner’s 4 posts that joins Joint Secretary’s level.
  • The Secretariat at the GST Council comprises members that are taken on deputation from State Government and Central Government.

Functions of the GST Council

Listed below are some of the functionalities of the GST council, as per Article 279A (4). The GST Council amends to all the necessary GST services that are responsible to guide to the Union and the States,  on some serious issues of GST like:

  • Cesses, surcharges and taxes that need to be subsumed under Goods & Services Tax.
  • Keep an eye on the Goods and services that need to be subjected to the tax bar or might not even come under the GST tab.
  • The threshold limit of turnover for every application that comes with the GST filing.
  • Different rates of GST across different commodities and GST details.
  • The different models of GST laws and the principles that are applicable to them, the appointment of IGST over the GSTIN registration and the common principles that are related to supply.
  • Special provisions that might be applicable over GST over the eight north-eastern states that comprise of Himachal Pradesh, Uttarakhand, and Jammu and Kashmir as well.
  • GST rates also include GST on real estate rates, special rates are also applicable for raising additional resources when in time of natural calamities such as natural disasters and other calamities for certain States.

Quorum and decision making inside the GST Council

For a valid meeting that needs to be held with the members of the GST Council, the council demands the presence of at least 50 percent members at the meeting.

Every decision that is made in the meeting needs to be supported by a minimum of 75% of the majority, out of the 50% that is present in the meeting. In “article 279A”, the government has stated a principle where the committee splits the total weighted vote that is cast, between the members from the State Government and Central Government:-

  • The vote that is cast by the Central Government as equivalent to the weighted average of one-third of the total votes.
  • The votes of State Government counts for the weighted average of two-thirds of the total votes that are cast in the meeting.
  • Any decision, act, or proceedings that happen at the time of the establishment of GST Council will be declared as not valid, based on any remaining deficiency.
  • If the GST Council has any vacancies for members.
  • In case there is a defect in the constitution of the Council.
  • Under circumstances where there is a defect in the person who is appointed as a member of the Council.
  • In case there is any procedure that is not duly complied with.
We hope our article turned out to be useful for you. For more such informative content, you can visit these linked articles as well:
GST On Mobile Phones GST On Clothes GST On Used Vehicles
GST On Medicines GST On Motorcycles Impact of GST On Logistics

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Q. What are the principles that govern GST?

A. The principles that govern GST are:

  • Cover over the place of supply
  • The overall threshold limits for
  • The overall rates over GST of goods and services
  • The special rates that are covered in cases of natural calamities of raising additional resources during a natural calamity or disaster
  • Certain States’ Special GST rates.

Q. When was the 38th Annual meeting of the GST Council formed?

A. The 38th GST Council Meeting was previously organised on December 18, 2019.

Q. What were the major highlights of the 38th GST meeting?

A. i. The major highlights in the 38th GST meeting revolved around how both the State-run and State-authorised lottery will carry a similar rate of GST at 28%, falling in effect from March 1, 2020.

ii. Entities that have a 20 percent government stake are not liable to pay GST payments. Their payments are applicable over the industrial/financial infrastructure plots’ long-term lease of January 1, 2020.