Page 48 - GSTL_26th March 2020_Vol 34_Part 4

J144 GST LAW TIMES [ Vol. 34
(b) To support the timely implementation of various initiatives, the
Council gave a go ahead for deployment of additional manpower
(60 in number) on T&M basis and assured that both on procurement
of additional hardware and hiring of manpower, expeditious ap-
provals would be given however the return filing experience of the
taxpayers and removal of technical glitches needs to be carried out
urgently.
Shri Nandan Nilekani assured that he would personally monitor the progress of
the GSTN project and also agreed to attend the IT-GoM for the next 6 months or
till such time the initiatives are implemented. The GST Council expects these ini-
tiatives to be implemented by the 31st of July, 2020.
[Based on Press Information Bureau, New Delhi, dated 14-3-2020]

GST rate for mobiles hiked to 18%, next meet to focus on
compensation payout
A tax rate hike for mobile phones to 18 per cent. from 12 per cent. to cor-
rect the inverted rate structure, a deadline to Infosys to resolve technological
glitches by July this year, and a call for a special session by April-end to look into
the legality of option of market borrowing to pay States in view of Compensation
Cess shortfall were some of the key decisions taken in the 39th Meeting of the
Goods and Services Tax (GST) Council on 14-3-2020. The impact of COVID-19 on
the economy was also discussed in the meeting, Finance Minister Nirmala Sitha-
raman said, adding the Government is trying to assess the economic impact of
the outbreak and is in talks with the industrial and the services sectors.
The Council also slashed GST on Maintenance Repair Overhaul (MRO)
services for aircraft to 5 per cent. from 12 per cent. with full Input Tax Credit
(ITC) and change the place of supply for B2B MRO services to the location of re-
cipient, while GST on handmade and machine-made matchsticks has been
clubbed to a single rate of 12 per cent. from 5 per cent. and 18 per cent. earlier,
respectively.
“There were suggestions recalling what late Arun Jaitley had said about
there can be ways that the Council can probably even borrow from the market.
So all this was discussed and I have very clearly said that I am committed to give
the compensation as is being collected...shall look at how if at all the Council is
allowed to borrow - who stands guarantee for it, how will it be paid, what’s the
interest that will be given - all these things will have to be legally looked into. So
I have told the Council on 15-3-2020 that I will have to look at all these things, get
more information, legally get the opinion and then come back to the Council as
to what I have in my hand. I also said if the Council have to go borrowing I will
also have to see what the impact of such a thing will be on the FRBM,” Sitha-
raman said.
As per the data for April-February shared at the GST Council Meeting,
the revenue gap between the protected revenue and the revenue accrued to
States has increased to 23 per cent. from 14 per cent. on an average. Punjab and
Himachal Pradesh are among the worst performers, with the revenue gap rising
to 46 per cent. and 41 per cent., respectively. Northeastern States are faring better

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