The GST council was born on 12 September 2016 under the 101 Amendment Act 2016 that abolished several taxes, combined them, and was named as GST which was implemented across the country. The GST council was made as per article 279(A) and comprises of
Members of Central Government
- The Union Finance Minister as Head or Chair-Person(Presently Ms. Nirmala Sitharaman)
- The Union Minister that is in charge of the Revenue or Finance
Members of 29 States
- The respective finance Ministers of the States or any other minister appointed by the State Government
- These ministers appoint the Vice-Chairperson of the GST Council and also have the right to decide his/her time period.
A decision comes into effect when it has the majority of 3/4th of GST council which comprises of
- 2/3rd votes of States
- 1/3rd Votes of the Centre (given more advantage)
- Each state has 1 vote.
Note: 50% of the GST Council must be present while taking any important decision.
The following are the role or functions of the GST council in India. It is seen that every aspect of the GST is in the hands of the GST council to decide upon.
- The GST Council has a right to recommend the State Government and Central Government on matters of Taxes, Cess Collection from the country, and other taxes that have been subsumed with the advent of Goods and Services Tax which ere earlier levied by the State Government, Central Government, and local bodies.
Note: The GST council doesn’t have the power to implement or take any decisions regarding the matters mentioned above. They have the power to advice on these issues.
- The council is further obligated to perform certain duties including duties to make GST Laws, Principles on the levy, Principles that determine the place of supply, the tax levied on inter-state supplies or trade, and under Article 269A to regulate commerce trade.
- Different sets of threshold limits are imposed on different people and people are informed about enrollment under the GST Registration.
- For goods which are exempted under the GST, ‘particular’ threshold limit is decided by the council. It also decides which goods are to be exempted and which are to be introduced in the list.
- It is their duty to notify people about the different Goods and Services Tax rates applicable to various goods.
- It is their function to give special rates, provisions, and threshold limits for particular states which also include the 7 North Eastern States under sub clause (7). These are
- Arunachal Pradesh
- Himachal Pradesh
- Jammu and Kashmir
- It is their role to introduce special rates on products or services during any natural calamity, floods, or disaster to have an additional resource and give relief to the victims.
- It is their duty to adjust and resolve the disputes among the Central Government, State Government, and various states.
- It is their duty to keep a watch on the Goods and Services Tax-related matters, hot topics, or discussions related to it.
- It is their function to introduce different tax slabs and the products falling under them.
- They set up floor rates.
- It is the responsibility of the GST Council to keep a check on the performance of the GST and to ensure proper working.
- The GST Council has to take such decisions that ensure the harmonized structure of GST and the national market for goods and services as mentioned in clause 6 of article 279A.
- Certain petroleum products like high-speed diesel, petrol, etc. carry no GST, so, it is further the duty of the council to present the matter in the upcoming GST Council meetings to decide upon the same.