GST Council to Meet Officials From Six Key Sectors Today
The all powerful GST Council headed by the Finance Minister will meet the representatives of six crucial sectors, including IT, telecom, banking and insurance on Tuesday, to assess the implementation hurdles under the new GST regime.
An Indian consumer goods trader shows letters GST representing "Goods and Services Tax". (Image: AFP)
New Delhi: The powerful GST Council headed by Union Finance Minister Arun Jaitley will meet the representatives of six crucial sectors, including IT, telecom, banking and insurance on Tuesday, to assess the implementation hurdles under the new GST regime.
Representatives of the Civil Aviation and Railways will also make their presentation at the two-day GST Council meeting.
"We support the introduction of GST but its should not complicate the business operations of IT companies," R Chandrashekar, President of Nasscom, had said.
Nasscom's concerns pertain to areas like classification of software, import of services from related parties, and taxation rules based on location of receiving services.
Stating that the first draft of GST law had classified all 'intangibles' as services thereby ensuring a uniform tax rate, the revised law removed the clarification.
"This could lead to a situation where software classification can be disputed even under the GST regime. Electronic downloads should be treated as services as the majority practice prevalent globally," according to Nasscom's recent representation to the Revenue Department.
Nasscom also contends that revisions in the draft GST law does not facilitate offering a single interface for overseas/domestic clients in cases where large service contracts are supplied to multiple client sites from single or multiple delivery centres.
Also, the revised draft potentially makes onsite services delivered overseas at customer site liable to payment of GST, followed by a refund which blocks capital and complicates the transaction, it added.
"This will therefore imply that onsite services are imported into India, GST discharged, and then exported, and the GST paid on the onsite service then filed for refund - additional unnecessary transactions for companies which operate in a Branch office model, and associated compliance and working capital troubles," says Nasscom.
Nasscom is also of the view that the legislation should clearly provide for centralised registration of central taxes of IGST (Integrated-GST) and CGST (central GST), which is within the Central Government power itself.
The GST Council among other things will deliberate on the issue of jurisdiction of assessees in the new regime.
At the end of the last meeting of the GST Council on December 23, 2016, Jaitley had said that the Council has made a 'reasonable headway' on supporting legislations and a discussion on Integrated GST law will take place in the next meeting.
The dual control over assessees is also part of the Integrated-GST legislation that Parliament needs to pass before the new regime is rolled out.
The stumbling block in the GST roll out is the issue of dual control issue -- which deals with which taxpayers should be controlled by the Centre and who should be governed by the states after a single tax will replace levies like central excise, service tax and VAT.
(With PTI inputs)
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