GoM on GST rate rationalisation to meet August 20 21; Council to finalise reforms in September

The group of ministers (GoM) tasked with rationalising Goods and Services Tax (GST) rates and easing compliance burdens will meet on August 20-21 to finalise its recommendations, Finance Ministry officials said earlier today.

The proposals will then be placed before the GST Council, which is expected to convene in the third or fourth week of September to finalise the reforms announced by Prime Minister Narendra Modi in his Independence Day address on August 15.

Officials told Business Today that the Centre has already circulated a detailed proposal document among members. “The GoM will examine these proposals closely over its two-day meeting and draft a final report for the Council,” a senior official said.

Considering the wide-ranging reforms under discussion — from rate rationalisation and process simplification to quicker registrations and automated refunds — sources suggested that the GST Council may require multiple sittings to build consensus.

“The Council could convene over two days, given the comprehensive nature of the reforms on the table,” an official added.

This would be the 56th meeting of the GST Council, chaired by Finance Minister Nirmala Sitharaman.

Officials pointed out that the GST reform exercise has been in progress for more than two-and-a-half years but has seen intermittent delays, partly due to factors such as changes in the GoM’s composition after the new government took office in Karnataka.

Despite those past hurdles, officials now expect speedy progress to be made in aligning states on the changes.

The upcoming meetings will be crucial in implementing the Prime Minister’s Independence Day announcements as a ‘Diwali gift’ ahead of the festival on October 20 later this year.

Once the GoM submits its report, the GST Council, comprising the Union Finance Minister along with finance ministers from all states, will decide on the timeline and modalities for rolling out the proposed reforms.

Once approved, the new framework would represent the most significant overhaul of GST since its launch in July 2017, impacting businesses, consumers, and state finances alike.

“The structure is going to change completely. What came into effect in 2017 was a structure that was largely based on what existed prior to the advent of GST. Eight years later, we have readied a template from our learnings”, officials added.