The government is not considering setting up an anti-profiteering body under the Goods and Services Tax regime anytime soon and the GST Council will take a final call in the matter.
“There is no timeline as to when this will be set up as the priority is to roll out GST (Goods and Services Tax),” Central Board of Excise and Customs (CBEC) Chairman Vanaja Sarna told BloombergQuint in an interview. The GST Council will decide whether any such body will be set up or this work will be assigned to an existing regulator like the Competition Commission of India, she said.
The Central GST Law includes a provision to pass on the benefits of reduction in tax rates to consumers once the new indirect tax regime is implemented, and is generally referred to as an anti-profiteering measure.
In a separate interaction, another senior official of the CBEC, to be renamed CBIC (Central Board of Indirect Taxes and Customs), told BloombergQuint that determining the fluctuations in the price of an individual commodity will be difficult as it depends on several factors.
A fall in prices of raw materials could be because of other global factors and not necessarily GST, the official said. It will then be difficult to conclude whether the prices fell because of the GST and if the lower prices should be passed on to consumers. It will also increase litigation, making life difficult for manufacturers, especially small and medium-scale industries, the official said.
The government is not considering setting up such an anti-profiteering body anytime soon, the official said requesting anonymity. It is studying the gray areas in a similar regulator established by the Malaysian government before implementing GST there, which he said turned out to be a failure.
GST Council May Consider Apple’s Proposals In Next Meeting
The GST Council will consider exemptions sought by industry associations and also iPhone-maker Apple Inc if the internal groups set up to examine these exemptions submit their report before its next meeting, Sarna said.
“Every industry has expressed concerns relating to their respective industry about what will happen under the GST regime. They have flagged some concerns, those are under examination. If things are ready by the next meeting, it will be brought before the Council in the next meeting on May 18-19.”
Vanaja Sarna, Chairman, CBEC
Efforts On To Resolve Legacy Excise, Service Tax Cases
All legacy service tax and excise duty dispute cases pending before the rollout of GST will continue to be dealt with provisions of the previous law, Sarna said. New GST commissionerates will have a dedicated cell to handle all legacy work, she added.
“Efforts are on to have minimum legacy cases, but those which are locked up in courts, we cannot do much about it; otherwise those which are with the officers like appeals/refunds, efforts are on to resolve them as soon as possible.”
There will always be some spillover, which will be dealt with by these commissionerates, she added.
The CBEC chairman also told BloombergQuint that 77 percent of the central excise taxpayers have already registered with the Goods and Services Tax Network (GSTN), the IT backbone of GST, along with about 57 percent service tax assessees. The government is also pressing for migration of existing taxpayers to the new system, she said.
Tax Rates For Precious Metals Not Decided
The government is yet to decide the tax rate for precious metals like gold and silver, and would consider it once the GST Council fixes rates for all other commodities.
“Whether precious metals will fit in the existing specified tax rates or will have a different rate structure is yet to be decided,” she said.
The GST Council has finalised a four-tier GST tax rate structure of 5, 12, 18 and 28 percent.