GST Council discusses revenue shortfall, sets up GoM on ‘calamity tax’

NEW DELHI: The GST Council on Friday set up a seven-member ministerial panel under Bihar Deputy Chief Minister Sushil Modi to examine the legality of imposing a new tax on certain goods and services to raise resources for natural calamity-hit states like Kerala.

The panel, headed by Union Finance Minister Arun Jaitley and comprising representatives of all states and UTs, also took stock of the shortfall in tax mop up by majority of the states under the new indirect tax regime.

Briefing reporters after the 30th GST Council meeting, Jaitley said the demand of Kerala to allow imposition of higher taxes on goods and services within the state to help tide over the losses suffered due to the recent floods was considered by the Council. It was decided that the matter should be referred to a seven-member Group of Ministers (GoM), which would include representatives from North-Eastern, hilly and coastal states.

The GoM, which has Assam Finance Minister Himanta Biswa Sarma and Kerala Finance Minister Thomas Isaac as members, would submit its report by October 31.

It will look into five issues flagged by the Council, including whether the new tax should be levied only in the state concerned or should it be an all-India levy, and that should it be on specified luxury or sin goods only. (AGENCIES)