The Goods and Services Tax (GST) Council is set to hold its next meeting on September 12 in New Delhi, marking its first gathering in a year. An officers’ meeting will precede this crucial session on September 11, according to an official memorandum.
Typically, the Council is expected to meet once every quarter. This upcoming meeting follows a period that saw state assembly elections and the Monsoon Session of Parliament conclude, clearing the way for the Council, led by Union Finance Minister Nirmala Sitharaman, to address pressing fiscal matters.
Key Agenda Items for Discussion
Among the primary items on the agenda, the Council is anticipated to review the existing norms governing Input Tax Credit (ITC). This includes a close examination of the framework that links a recipient's entitlement to ITC with the supplier's deposit of tax into the government treasury, a condition that has led to significant litigation.
Manoj Mishra, Partner and Tax Controversary Management Leader at Grant Thornton Bharat, emphasized the need for reform. “The Council should revisit one of the most litigated conditions governing input tax credit (ITC). The present framework links a recipient's entitlement to ITC with the supplier's deposit of tax into the Government treasury, despite the recipient having little practical ability to monitor such compliance,” Mishra stated. He further added that the Council should prioritize reducing litigation by addressing genuine interpretational disputes, with particular attention to the Supreme Court's decision in the Gameskraft case.
Another critical area of focus will be the review of the revenue position for both states and the Centre, following the rate rationalization measures implemented last year. The Council will assess the financial impact and sustainability of these changes.
Operational Status of GST Appellate Tribunal
The meeting will also take stock of the operationalization and functioning of the GST Appellate Tribunal. Ensuring the effective working of this tribunal is crucial for resolving disputes and streamlining the tax administration process.
Procedural Reforms and Industry Demands
Building on measures from its last meeting, the Council is expected to advance discussions on procedural relaxations and reforms. These include initiatives aimed at making business registration and audits easier for companies. While certain industry sections have called for a review of GST rates on their goods and services, it remains uncertain whether the Council will consider these demands immediately.