[aaykarbhavan] source Business Standard

Govt okays GST changes  Largely accepts Rajya Sabha panel

NCABINET DECISIONS N BS REPORTER New Delhi, 29 July The Union Cabinet on Wednesday cleared important changes to the government's constitutional amendment Bill on the proposed national goods and services tax ( GST). However, exact modalities of a crucial change to limit up to one per cent tax over GST to inter- state sale of goods would be decided later, a move taken to woo dissenting parties. The changes were based on recommendations by the Rajya Sabha panel which examined it; the committees report was given a few days earlier. The revisions are likely to be introduced in the Houses ongoing session. The Lok Sabha had earlier passed the legislation, which means it will have to now approve these changes. The constitution amendment is an enabling mechanism to allow the Centre and states to impose a GST. After its passage, the new indirect tax regime would require another central law, as well as state laws, on a GST. The Bill passed by the Lok Sabha had a provision for levy of a tax up to one per cent additional to the GST, for interstate supply of goods. The idea was to help producing states in the switchover, as GST is a destinationbased tax. However, this had drawn criticism for those who said it would have a cascading effect. To address the interests of both sides, the panel had recommended the proposed GST law say inter- state movement of goods wouldnt be taxable if without a consideration, meaning the movement of goods within the same company (stock or branch transfers) would be exempt. The cabinet decided to defer determining the details of the mechanism to restrict the tax of up to one per cent over GST on inter- state movement of goods for a consideration. It may come up either in the GST law or GST rules later. The Rajya Sabha panel had also suggested that compensation to states should not decline from the fourth year. The current Bill said states would be fully compensated for their losses for the first three years after the switch; this would fall to 75 per cent in the fourth year and 50 per cent in the fifth. The panel wanted full compensation for five years, not a tapering one. The suggestion has been cleared by the Cabinet. report; modality of limiting 1% tax to inter- state sales to be decided later; Congress still opposed

 

Consumer protection Bill cleared The Cabinet on Wednesday gave its nod to a new Consumer Protection Bill, which seeks to replace the Consumer Protection Act, 1986 and proposes to set up a regulatory authority having the powers to recall products and initiate class action suit against defaulting companies, including e- tailers. The Bill assumes importance as there is growing concern over the safety of consumer products and services, especially after the Maggi controversy. Sources say the Bill might be introduced in the ongoing session of Parliament. The move comes in the backdrop of complex products and services in ecommerce, which has rendered consumers vulnerable to new forms of unfair trade and unethical business practices. BS REPORTER

 

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Posted by: CS A Rengarajan <csarengarajan@gmail.com>

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