Key meeting of GST Council to be held in New Delhi on September 3, 4 

The 56th Meeting of the Goods and Services Tax Council will be held in New Delhi on September 3 and 4, a notification by the GST Council issued on Friday reads.

The two-day meeting is expected to address key issues related to the Goods and Services Tax (GST) framework in the country.

Additionally, a preparatory Officers’ Meeting has been scheduled in Delhi for September 2. This meeting will lay the groundwork for discussions to be held during the GST Council meeting.

The GST Council, chaired by the Union Finance Minister and comprising state finance ministers, plays a crucial role in shaping the GST policy framework. The upcoming meeting is anticipated to deliberate on critical matters such as tax rate rationalisation, compliance measures, GST exemption on health and life insurance, and potential amendments to the GST law, though specific agenda details are yet to be disclosed.

On Thursday, the Group of Ministers on Goods and Services Tax rate rationalisation supported the Centre’s proposal to simplify the GST structure by reducing tax slabs from four (5%, 12%, 18% and 28%) to two (5% and 18%), alongside a special 40% rate for select demerit goods like tobacco and high-end automobiles. However, the members from Opposition-ruled states expressed concerns over the expected revenue shortfall post the two-rate structure.

Bihar Deputy Chief Minister and Chairperson of the GoM Samrat Choudhary said they will recommend the two-rate structure proposal of the government to the GST Council.

"We discussed the Centre’s proposal to end two slabs of GST -- 12% and 28% -- and have supported it. The GST Council will decide on this now," said Choudhary.

West Bengal Finance Minister Chandrima Bhattacharya stressed the importance of quantifying the potential revenue loss, stating, “Quantification of loss has not been done yet. This is important to know. We have to think about how to compensate the states.”

She also proposed that items currently attracting over 40% tax, including compensation cess, such as luxury and demerit goods, should face additional duties to offset any revenue shortfall.

The proposed GST reforms come as the compensation cess regime, designed to offset state revenue losses, is set to end on March 31, 2026. The GST Council is also expected to address issues, such as GST exemptions on health and life insurance premiums, in its meeting. On Wednesday, the GoM had proposed the GST exemptions on health and life insurance for individuals.