New Delhi, july 27 : The Centre and states have agreed on the principle to keep Goods and Services Tax (GST) rates lower than the current levels of taxes.
Union Finance Minister Arun Jaitley chaired the meeting of the Empowered Committee of state Finance Ministers in New Delhi yesterday to discuss the GST Bill which has been passed in the Lok Sabha but is stuck in the Rajya Sabha.
It was also agreed to include in the Constitutional Amendment Bill the mechanism of compensating states for any loss of revenue in the first five years of GST subsuming all indirect tax levies including VAT.
Talking to media after the meeting, West Bengal Finance Minister and the panel Chairman Amit Mitra said there was broad agreement on the principle that the ordinary businessman and the common man will benefit from introduction of GST by way of lower tax rates while the states will not face any loss of revenue.
"There was consensus to keep the GST rate out of the bill, a key demand earlier cited by the Congress.
A businesses of less than 1.5 crore rupees turnover should be under states' control and the above 1.5 crore rupees will be under dual control of states and Centre," he added.
The government is keen to get the GST bill approved during the current monsoon session of Parliament ending on August 12.
It is facing opposition from the Congress which wants a low tax rate to be part of the Constitutional Amendment Bill.
It also demands that 1 percent additional tax in hands of states over and above the GST rate be scrapped.