Goods and Services Tax (GST) Council Meeting

The upcoming GST Council meeting will address several critical issues including rate rationalisation and the future of the compensation cess. The date for this meeting will be announced soon.

• The Groups of Ministers (GoMs) have submitted their reports on making GST simpler.
• Key issues to be discussed include: 
  1. Compensation cess
  2. Rate rationalisation
  3. GST simplification
• The meeting will be scheduled after giving states a three-week notice.

Rate Rationalisation and Compensation Cess

The GST Council, headed by Union Finance, previously did not take up rate rationalisation or rate reduction in health and life insurance during its December meeting.

• Bihar Deputy Chief Minister Samrat Choudhary is the convener of the GoM for rate rationalisation.
• The GoM on compensation cess, led by Minister of State for Finance Pankaj Chaudhary, is evaluating the future of this cess beyond March 2026.
• The compensation cess is currently levied on luxury and sin goods, primarily for repaying Covid-related loans compensating states for GST revenue losses.
• The GoM is considering methods to retain revenue from the cess and its distribution between the Centre and the States.

India’s Growth Prospects and Cryptocurrency Regulation

• India’s growth outlook remains positive with minor variations in growth projections from rating agencies and multilateral lending agencies.
• A predicted above-normal monsoon and strong farm output are expected to boost consumption.
• The regulation of cryptocurrency is still challenging due to the lack of a unified international stance.

Prime Minister’s Internship Scheme

The Prime Minister’s internship scheme is gaining interest, with potential changes being considered based on pilot projects.

• The scheme, part of the Union Budget for 2024-25, aims to provide internships to one crore youth in the top 500 companies over five years.
• The corporate affairs ministry identified these companies based on their average CSR expenditure over the past three years.
• The Cabinet will approve modifications to the scheme, informed by pilot project experiences.
• Industry chambers like Confederation of Indian Industry (CII) and Federation of Indian Chambers of Commerce and Industry (Ficci) show increased interest.

Council Updates

• The meeting will be held after states are given a three-week notice.
• There are three to four aspects under consideration for simplifying GST.
• The GoMs are investigating alternative forms of retaining revenue from the cess.