The GST Council, which is scheduled to meet next week, is likely to discuss the Goods and Services Tax (GST) on cryptocurrency transactions in the meeting. According to a media report, the panel may not finalize a rate in the upcoming meeting but may discuss keeping it in the highest tax slab of 28 per cent.
The council is seeking to broaden the tax net to more effectively track transactions in virtual digital assets, a Bloomberg report said, adding that a finance ministry spokesperson immediately responded to a call seeking comment. Didn’t answer.
The 47th meeting of the GST Council will be held on 28-29 June (Tuesday and Wednesday) in Chandigarh.
In the Union Budget 2022, Finance Minister Nirmala Sitharaman announced that the government would impose a stable tax at a flat rate of 30 per cent on virtual assets, including cryptocurrencies and non-fungible tokens or NFTs. The budget also introduced a provision for deduction of tax at source at 1 per cent levied on payments made from transfer of virtual assets.
During the 47th meeting, the GST Council, chaired by Finance Minister Nirmala Sitharaman, may also discuss a proposal to cut the exempted items list, plan to shift rate slabs and fix the inverted duty structure in textiles. It may discuss a proposal to shift the rate slab from the existing five per cent to seven or eight per cent; and from 18 percent to 20 percent. The council may also discuss a proposal to fix the inverted duty structure in textiles.
The Council-appointed Group of Ministers (GoM) headed by Karnataka Chief Minister Basavaraj Bommai has already held its meeting to discuss these issues. According to a PTI report, the GoM could not reach a consensus. The report said that the Group of Ministers will, however, submit a status report to the GST Council on the consensus reached at the last meeting of the GoM on November 20, 2021. The panel, which was set up in September last year, last met in November 2021.
At present, there are four GST slabs – 5 per cent, 12 per cent, 18 per cent and 28 per cent. There are 480 items in the 18 per cent slab, of which about 70 per cent of the GST collection comes. In addition, there is an exemption list of items such as unbranded and unpacked foods that do not attract levies.
The GST collection in May amounted to Rs 1,40,885 crore, a jump of 44 per cent year-on-year. However, this was a drop of 16 per cent as compared to the GST collection in April. The gross GST revenue collected in May 2022 was Rs 1,40,885 crore, of which CGST is Rs 25,036 crore, SGST is Rs 32,001 crore, IGST is Rs 73,345 crore (including Rs 37,469 crore collected on import of goods) and cess is Rs 10,502. crore (including Rs.931 crore collected on import of goods).
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