GST Council-Structure of the GST Council

In order to amend the Constitution to enable introduction of GST, the Constitutional (122nd Amendment) Bill, 2014 was introduced in the Parliament. 
The Constitution Amendment Bill was passed by the Lok Sabha in May, 2015. 
The Bill with certain amendments was finally passed in the in the Rajya Sabha on 3rd August, 2016 and thereafter by the Lok Sabha on 8th August, 2016. 

1. The GST Council In order to amend the Constitution to enable introduction of GST, the Constitutional (122nd Amendment) Bill, 2014 was introduced in the Parliament.  The Constitution Amendment Bill was passed by the Lok Sabha in May, 2015.  The Bill with certain amendments was finally passed in the in the Rajya Sabha on 3rd August, 2016 and thereafter by the Lok Sabha on 8th August, 2016.  As per Article 279A(1) of the Constitution, the GST Council had to be constituted by the President within 60 days of the commencement of the Constitution (One Hundred and First) Amendment Act, 2016. 

2. As per Article 279A(2) of the Constitution, the GST Council shall consist of the following members: -   a) The Union Finance Minister  b) The Union Minister of State in charge of Revenue or Finance  c) The Minister in charge of Finance or Taxation or any other Minister nominated by each State Government   d) Any person nominated by the Governor of the State where there is a proclamation of emergency under Article 356 of the Constitution of India.   

3. Structure of the GST Council The states and the center participate jointly in the GST council. The Union Finance Minister is the chairperson of the GST Council. The Union State Minister of Revenue or Finance and the Ministers managing Finance or Taxation in each State are among the other members of the GST Council. The members of the state councils are required to select one member to serve as the vice-chairperson of the GST Council. They also have the authority to choose their term. The 33 members of the GST Council are divided between two members from the central and 31 members from 28 states with legislation and three Union territories. The central board of excise and customs’ chairman is always invited to all meetings but does not have voting rights.

4. Principles and Objectives of the GST Council To establishment of a unified national market for goods and services, along with a standardized GST structure, serves as the guiding principle of the GST Council.  Being the first constitutional federal body with the authority to decide on all significant matters about GST, the Council aims to establish the highest standards of cooperative federation in its operations. the Council aims to develop a GST structure that is information technology-driven and user-friendly

5. Features of GST Council Features of the GST Council include the following: The Indian Revenue Secretary serves as the Ex-officio Secretary to the GST Council. All GST Council meetings are chaired by the Central Board of Excise and Customs (CBEC), which also serves as a permanent invitee with no vote. There would be a position created for the GST Council’s Additional Secretary. This position would be equivalent to that of the Indian government’s Additional Secretary. Four commissioner positions would be created in the GST Council Secretariat at the rank of Joint Secretary of the GST Council. Officers appointed from both the Central and State Governments on a deputation basis would make up the GST Council Secretariat.

6. Functions of the GST Council The GST (Goods and Services Tax) Council is a key decision-making body for the implementation and administration of the GST in India. Established under Article 279A of the Indian Constitution, it ensures coordination between the central and state governments regarding GST-related issues. Here are its main functions:

7. 1. Formulating GST Rates Decides the GST rate slabs for goods and services (e.g., 0%, 5%, 12%, 18%, 28%). Reviews and modifies rates periodically to address economic needs and revenue considerations. 2. Addressing Tax Exemptions Recommends lists of goods and services to be exempted from GST. 3. Resolving Taxation Issues Resolves disputes related to GST between states or between states and the central government. Ensures uniform application of GST laws across India. 4. Recommendations on Tax Structure Suggests changes to GST laws, rules, and regulations. Proposes methods for the apportionment of GST revenue between the center and states. 5. Special Rates Determines special GST rates for specific cases, such as natural disasters or emergencies. Formulates cess rates to raise additional funds for compensation to states.

8. 6. Ensuring Compliance Frames guidelines for GST implementation, including procedural and administrative aspects. Addresses challenges faced by stakeholders to enhance compliance. 7. Monitoring and Evaluation Evaluates the impact of GST on the economy, trade, and revenue collection. Ensures that GST contributes to economic growth and fiscal federalism. Composition of GST Council Chairperson: Union Finance Minister. Members: State Finance Ministers or their nominees. Decision-Making: Resolutions require a three-fourths majority, with the central government holding one-third of the votes and the states collectively holding two-thirds.

9. Powers of GST Council Recommendation of GST Council Special Rates and Exemptions Threshold limit for Exemption Division of GST Revenues Administration and Implementation Dispute resolution Model GST Laws Monitoring and Evaluation