With Bommai and PTR out, GST Council needs to rejig GoMs
The Hindu
The change of guard after the Assembly election in Karnataka and the Ministerial council shuffle in Tamil Nadu has triggered the need for the GST Council to reconstitute at least three Ministerial panels
The change of guard after the Assembly election in Karnataka and the Ministerial council shuffle in Tamil Nadu has triggered the need for the Goods and Services Tax (GST) Council to reconstitute at least three Ministerial panels tasked with recommending critical reforms of the indirect tax regime.
Basavaraj S. Bommai, who resigned as the Chief Minister of Karnataka on Saturday, was the chairperson of the GST Council’s group of ministers (GoM) tasked with the rationalisation of GST’s complex rates’ system with multiple tax slabs.
The panel, formed in September 2021, initially had a two-month deadline. With inflation running high through 2022-23 and remaining a concern, the government has been going slow on the GST rate rationalisation agenda. Sweeping structural changes would likely mean higher tax rates for several items.
Mr. Bommai’s exit from power will mean the Council would have to appoint a new convenor for the panel, that also had Ministers from six other States, including Kerala Finance Minister K.N. Balagopal.
Palanivel Thiaga Rajan, the former Finance Minister and current IT minister of Tamil Nadu, was also involved in two of the Council’s GoMs — one tasked with GST’s IT system reforms to tackle evasion, and another on the appropriate tax treatment to be adopted for casinos, online gaming and horse-racing.
Mr. Thiaga Rajan will most likely be replaced by the new State Finance Minister Thangam Thennarasu, going by the practice adopted by the GST Council for GoM membership changes due to external factors.