Finance Minister Nirmala Sitharaman is expected to consider myriad proposals in her first GST Council meet on June 21. The meeting which was earlier slated for June 20 has been postponed to June 21.
The council at its 35th meeting under the new FM is likely to consider slashing GST on electric vehicles to 5% from 12%, ways to curb tax evasion, extending the tenure of the National Anti-profiteering Authority (NAA) till November 30, 2020, electronic invoices (e-invoices) system, the revenue position of states, the new return filing system, setting up an appellate tribunal for north-eastern states and another one for all Union Territories (UTs), levy of GST on extra-neutral alcohol (ENA) used in manufacturing liquor for human consumption etc.
ENA a is derivative of sugarcane molasses (95% high-purity ethyl alcohol) and is not an alcoholic liquor for human consumption but can be used as raw material or input, after processing and substantial dilution, in the production of whisky, gin, country liquor etc.
The GST Council is also expected to evaluate the suggestions made by the committee of officers on the use of radio-frequency identification (RFID) data for strengthening e-way bills.
Regarding the extension of NAAs term the Finance Ministry is of the view that anti-profiteering authority should be given an extension of one year till November 30, 2020 as the authority continues to receive complaints of profiteering by companies, an official told PTI.
The NAA is keen for a two-year extension, the official said, adding the final call will be taken by the GST Council in its meeting on 21 June. Soon after the GST was rolled out from 1 July 2017, the government had approved setting up of the NAA for two years to deal with complaints by consumers against companies for not passing on GST rate cut benefits.
The NAA came into existence on 30 November 2017, after its Chairman B N Sharma assumed charge. So far, the NAA has passed 67 orders in various cases. The GST law provides for setting up of benches of appellate tribunal in all states. Although 18 states have got the approval to set up appellate benches, none of these states have operationalised them.
The GST Council in its 21 June meeting is also likely to approve the proposals of Delhi, Odisha and Telangana to set up appellate tribunal benches. The Council will also take a call on setting up a combined bench for all north-eastern states as well as one bench to deal with appeal cases in six Union Territories -- Chandigarh, Puducherry, Lakshadweep, Daman and Diu, Dadra and Nagar Haveli, and Andaman and Nicobar Islands, the official said.
With regard to bringing ENA under GST, states have divergent views. Larger states like West Bengal, Rajasthan, Haryana, Tamil Nadu, Karnataka, Andhra Pradesh and Maharashtra have been of the view that ENA should be out of GST.
States currently levy Value Added Tax (VAT) and Central Sales Tax (CST) on ENA but they will have to forgo the right to levy these taxes on the product if it is brought under the ambit of GST.
The GST Council had earlier sought the opinion of the Attorney General on legality of imposing GST on ENA. The AG had then opined that since ENA is not consumed directly by people, GST can be imposed on it. Currently, potable alcohol is out of the ambit of GST and states are free to levy taxes on them.
Among other things, the GST Council will also consider issuance of e-invoice by entities with turnover of over Rs 50 crore for business-to-business (B2B) sales in a bid to curb GST evasion.