Key takeaways from the 46th GST Council Meet

Key takeaways from the 46th GST Council Meet

by 5paisa Research Team Last Updated: Dec 13, 2022 - 03:18 pm 41.9k Views
Listen icon

As per the Finance Minister, Nirmala Sitharaman, who chaired the 46th meeting of the GST Council, the meeting was called under the emergency meeting provisions. This meeting had been called specifically at the request of the Finance Minister of Gujarat to discuss the deferment of the increase in GST on textiles from 5% to 12%.

In the 45th meeting of the GST Council, it had been decided to address the anomaly of inverted duty structure in certain products. To rectify this anomaly, the Council had suggested raising the GST rate on textiles from the existing 5% to 12%. This hike in GST rate was to be effective from 01-January 2022.

However, after the decision was taken, there had been severe protests. The textiles traders across the North had objected to this hike in GST on textiles. Other states like West Bengal, Tamil Nadu and Gujarat with a robust textile industry had called for deferring this provision. In fact, Dr. Amit Mitra of West Bengal had warned that 15 million jobs could be lost.

In deference to the strident demands, the Finance Minister confirmed in the press briefing that the decision to raise the GST rates on textiles from 5% to 12% was being deferred till the next meeting in February. In the meanwhile, as a special case, the issue of duty inversion in the textiles sector will be referred to a rate rationalization committee.

It may be recollected that the objections to the GST Hike from 01-Jan pertained to the textiles industry and the footwear industry. However, as per the statement by the Finance Minister, the decision to defer the increase in GST was only taken in the case of textiles. That logically means that footwear will attract the higher rate of 12% GST from 01-January.

The GST offsetting compensation had been offered by the center for a period of 5 years. That compensation scheme would come to an end in June 2022. The Finance Minister of Kerala had demanded another 5 year extension of the GST compensation scheme, but that was not taken up for discussion in the meeting on 31-December.

Regarding tweaking of GST rates or the merging of the 12% GST and 18% GST slabs, there has been no debate and hence no decision at the 46ths GST Council meet. Status quo has been maintained on these issues. The next meeting of the GST Council is scheduled on February after the presentation of the Union Budget for 2022-23.

How do you rate this blog?

Start Investing in 5 mins*

Rs. 20 Flat Per Order | 0% Brokerage

oda_gif_reasons_colorful

About the Author

Our research team is composed of some highly qualified research professionals, their expertise range across sectors.

Enjoy 0%* Brokerage with 5paisa
Resend OTP
Please Enter OTP
Mobile No. belongs to

By proceeding, you agree to the T&C.

Latest Blogs
Market Outlook for 22 April 2024

Our markets corrected sharply in the week gone by mainly due to uncertainty over global geopolitical tensions and selling by the FIIs which resulted in the index breaking the 22000 mark. However, we witnessed recovery from the low of 21780 in the last trading session and Nifty ended around 22150 with a weekly loss of over one and a half percent.

Stock in Action - Escorts Kubota Ltd

Escorts Kubota Stock Movement of Day    

Weekly Outlook on NATURAL GAS - 19 April 2024

The cost of natural gas saw a 2.7% increase yesterday, closing at 146.90, as projections of limited feed gas demand and milder weather tempered upward momentum. Despite concerns over a significant storage surplus and reduced demand forecasts for the next fortnight, substantial price shifts were notably absent.