IGST: Group of ministers to address state woes

NEW DELHI: Over two months after the last GST Council meeting, a 10-member group of ministers (GoM) headed by finance minister Nirmala Sitharaman has been set up to address concerns raised by several states, regarding the settlement of integrated GST (IGST) between the Centre and states.
Interestingly, the GoM, which will look at the settlement at the end of March 2018, was set up on Monday, when finance ministers from some of the opposition-ruled states met Sitharaman for release of compensation money for August and September.

In a communication, the GST Council secretariat said the ministers will look at ways to split the IGST that remained unapportioned at the end of March and work out a formula based on the legal provisions. Unlike central and state GST, which is split equally between the Centre and the states, IGST is a more complex as it covers sales across states and is also levied on imports and goods and services provided by SEZ.
While the IGST payment flows to the Centre, it transfers the tax to the state where the goods are consumed. Besides, the transaction involving the states also has to be settled through a system of transfers.
Compared to the issue of compensation, where some of the states are threatening to approach the court, the GoM’s task is seen to be less complex. Puducherry CM V Narayanasamy, Bihar deputy CM Sushil Modi, Delhi deputy CM Manish Sisodia, Chattisgarh commercial taxes minister TS Singh Deo and Punjab FM Manpreet Badal, Odisha FM Niranjan Pujari and Tamil Nadu fisheries minister D Jayakumar are members of the GoM.