New Delhi: When the GST Council that is fully fulfilled at Lucknow on Friday, the center will present the option for compensation formulas for the countries from next July, when the current regime ensures 14% annual growth ends.
But the one-sized-fit approach – all may not be a new spell to decide on compensation formulas, with officials showing that it must be assessed and given incentives for those who try hard to increase compliance and collection.
With all accounts, at least a dozen countries failed to show any initiative to increase the collection, the main problem with Nirmala Sitharaman and his team at the Ministry of Finance would be a deep factor, while proposing a new mechanism for the Minister of Finance.
The pre-pandemic experience in GST revenue the country has shown extensive variation and the 15th financial commission has appointed it.
“The guarantee of a 14% growth rate for five years, by treating all countries in PAR in terms of GST’s revenue growth, despite the experience of their broad income growth in the past, has created other important complications in federal finance,” he recorded.
In the report.
There is a recognition that some states, such as Himachal Pradesh, Uttarakhand, J & K and those in the northeast may need help because the central sales tax is the main source of income.
Although northeastern countries such as Arunachal Pradesh and Nagaland have seen high growth rates in recent months, officials admit that some of them will be tapered, given the increase on a small basis.
“They do not have the necessary administration regulated in VAT days, which are now there and help them with the collection,” an officer explained.
Conversely, it has been noted that several countries have been loose with collection initiatives, to the level of reducing enforcement arrangement, often preventing tax aversions.
While the country has claimed that the design is defective and there is an implementation problem, officers at the counter argument center.
“There are extensive variations between countries, which are entirely about how you overcome the problem of avoidance and law enforcement,” said an officer.
While the new formula is debated in Lucknow, which is clear is that consumers have to cough CESS for several more years to ensure that stating that declaring “do not fall from the cliff” so the current compensation regime ends in June.