GoM backs GST rejig; states flag risk to revenue

GST Council likely to take up proposal in September; rate cuts expected in October

- MONIKA YADAV

The group of ministers (GoM) on rate rationalisation, comprising state finance ministers, has endorsed the Centre's proposal for a two-tier goods and services tax (GST) structure and will recommend it to the GST Council, said Samrat Choudhary, Bihar deputy chief minister and GoM convener, on Thursday.

The central government, on August 15, had proposed to retain only 5 per cent and 18 per cent GST slabs, while introducing a new 40 per cent rate for sin and luxury goods. "We discussed the Centre's proposal to remove the 12 per cent and 28 per cent slabs. We have supported this and will recommend it to the GST Council for a final decision," Choudhary told reporters after the GoM's meeting.

The decision comes a day after another GoM, on health and life insurance, agreed to propose exempting individual insurance premiums from GST. Currently, 18 per cent GST is levied on both health and life insurance premiums for individuals.