FM Sitharaman to GST panels over the tempo rejig, cess-out phase from Wednesday

While the center continues its next wave of tax reforms, Finance Minister Nirmala Sitharaman will inform the groups of ministers (Gom’s) in New -Delhi this week about the rationalization of tax rates and the remuneration of compensation, two people said of the development. Sitharaman is expected to inform the three separate ministerial groups of the GST council, which will meet in the capital on Wednesday and Thursday. The three groups relate to the assessment, insurance and compensation. “The meetings scheduled for the next two days are of utmost importance in the implementation of GST reforms,” one of the persons above quoted on condition that they are not mentioned. The development highlights the urgency with which the central government is pursuing the tax reform that is expected to boost the consumption demand in the economy. Sitharaman is also chairman of the GST council. The ministerial group on rate rationalization led by the Deputy Chief Minister of Bihar, Samrat Chaudhary, and the group on compensation, led by civil servants Minister Pankaj Chaudhary, will investigate the proposals to finalize their recommendations to the GST council, which is expected to meet at one time or another, the second person above. Combined with the income tax relief offered to individuals in the budget this year, an above-average monsoon that is expected to support rural income, and interest rate cuts by the RBI, the proposed GST rate cut is expected to help stimulate the economy. The central government is also working on other reforms that can accelerate economic growth. Minister Narendra Modi held meetings with his senior cabinet colleagues and economists on Monday to discuss the next generation reforms, Mint reported Tuesday. According to the center’s proposals distributed to the ministerial groups, the 12% and 28% GST pages will be dropped, a new 40% page will be set for a handful of products, and the compensation box will be kept away. This restructuring can lead to some short -term loss in the short term, which the central government expects, will constitute the boost to demand for goods and services. According to a City Research note, the annual fiscal cost could be £ 1.1-1.2 billion, with about two-thirds of this burden eventually falling on states. Inquiries were sent to the Ministry of Finance and the GST Council’s Secretariat by e -mail on Tuesday to seek comments for the story, unanswered. According to city research, the 12% page would go away and move most products to 5%, reducing the tax burden on a wealth of essential goods, including medicine, processed foods and non -alcoholic beverages, some dairy products, clothing, hotel accommodation and construction material. The fusion of the 28% page with the 18% would benefit white goods such as air conditioners and refrigerators and cement, city research said.