Setting the stage for an overhaul of the multiple tax rates under the Goods and Services Tax regime, the government has tasked a Group of Ministers (GoM), led by Karnataka Chief Minister Basavaraj S. Bommai, with proposing a rationalisation of tax rates and considering the merger of different tax slabs within two months.
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Currently, the GST regime has five broad tax rate slabs of zero, 5%, 12%, 18% and 28%, with a cess levied over and above the 28% on some goods, and special rates for items like precious stones and diamonds.
Bommai’s seven-member group constituted by the Finance Ministry on Friday includes West Bengal Finance Minister Amit Mitra and Kerala Finance Minister K.N. Balagopal, as well as GST Council members from Goa, Bihar, Uttar Pradesh and Rajasthan.
The GoM shall review the current tax slab rates and recommend changes in the same as may be needed to garner required resources (and) review the current rate slab structure of GST, including special rates, and recommend rationalisation measures, including merger of tax rate slabs, required for a simpler rate structure in GST.
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