It is learnt from press reports that Certain Central Ministries and representatives from service sector – Software, Telecom, Banking and Insurance Railways – made presentations on their concerns, to the GST Council. Their main concern is that they require centralized registration, as in present service tax legislation, since they render services across India.
It is also reported that the demand for States for jurisdiction over Territorial Waters and certain issues in IGST Act was also discussed. Certain States charge State Taxes ( VAT/Sales Tax) on transactions within 12 nautical miles from the coast line. The IGST law vests this right with the centre. Since this is a Constitutional issue it is learnt that legal opinion would be taken on this issue. The issue is the definition of “State” and how far into the Territorial Waters its jurisdiction extends.
Briefing the press, Sri Amit Mitra elaborated on the issues in the Compensation for revenue loss to States already agreed upon and that post demonetization the quantum of compensation would be higher than projected earlier. He said that the Central Government will have to find ways and means of meeting the commitment to compensate revenue loss for the first 5 years of implementation of GST.
The issue of Dual Control and discussion on the probable roll out date may take place on 4th January, 2017.
The three legislations are yet to be finally approved by the GST Council. What has to follow is the decision on fitment of Goods and Services in the agreed rate of tax structure and the approval of the Rules.