GST Coun­cil Meet to Help Set Prof­i­teer­ing Clause into Mo­tion

The Economic Times - - Pure Politics - Our Bu­reau

New Delhi: The Goods and Ser­vices Tax Coun­cil will at its next meet­ing fi­nalise a mech­a­nism to op­er­a­tionalise the anti-prof­i­teer­ing clause which seeks to pro­tect con­sumers in­ter­est, fi­nance min­is­ter Arun Jait­ley told the Lok Sabha on Tues­day.

He said a proper de­ci­sion would be taken on Air In­dia's fu­ture and it would be in the gov­ern­ment's in­ter­est to pro­tect jobs at the air­line.

Re­ply­ing to a dis­cus­sion on sup­ple­men­tary de­mands for grants which was later passed by the LS he said de­mon­eti­sa­tion had squeezed ter­ror fund­ing.

ANTI-PROF­I­TEER­ING PRO­VI­SION

The GST Coun­cil com­pris­ing state fi­nance min­is­ter will meet on Au­gust 5 to take stock of im­ple­men­ta­tion of GST which was rolled from July 1.

The anti-prof­i­teer­ing pro­vi­sion man­dates busi­nesses to pass on the ben­e­fits aris­ing out of lower taxes to the con­sumer by way of com­men­su­rate re­duc­tion in prices. On con­cerns raised by mem­bers with re­gard to im­pact of GST on prices, Jait­ley said it would be manda­tory for man­u­fac­tur­ers to pass on the ben­e­fits of re­duc­tion in taxes to con­sumers.

He hoped that the de­ci­sion of price cut by au­to­mo­bile sec­tor on ac­count of ben­e­fit of in­put tax credit would be fol­lowed by oth­ers man­u­fac­tur­ers.

“What if in­put tax ben­e­fit is not trans­fered to con­sumers?...we are meet­ing a few days from now...In a short while, we are go­ing to fi­nalise the en­tire mech­a­nism as far as anti-prof­i­teer­ing is con­cerned.

“All you need is to make a few ex­am­ples and then every­body will fall in line. If there is ben­e­fit of the in­put credit then cost cor­re­spond­ingly must de­cline,” he said while re­ply­ing to a dis­cus­sion on sup­ple­men­tary de­mands for grants.

The in­dus­try was re­sis­tant to this clause, he said, adding, it has been put in the GST law for ini­tial few years to save the in­ter­est of con­sumers. The sup­ple­men­tary de­mands in­clude a pro­vi­sion of .₹ 2,000 crore for re­fund of Cen­tral GST to in­dus­tries in hilly and spe­cial cat­e­gory states of North East, Ut­trak­hand and Hi­machal Pradesh.

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