GST Council To Discuss Threshold Limit For Offences, Setting Up Appellate Tribunal

The 48th Goods and Services Tax Council meeting will be held virtually on Dec. 17, almost six months after the previous meeting was held towards the end of June.

The GST Council will take a final call on the Group of Ministers' report on setting up an appellate tribunal and raising the monetary threshold for initiating prosecution in criminal proceedings involving GST offences, according to a senior official with knowledge of the matter, who spoke on condition of anonymity.

The GoM report on casinos, online gaming, and horse racing will also be on the agenda of the council meeting, the person quoted above said.

The GoM report submitted earlier this year had recommended for a principal bench of the GST Appellate Tribunal to be set up in New Delhi, with large states having up to five benches. It also suggested a relaxation in the criteria for the appointment of members, as reported by the Economic Times.

The final GoM report on casinos, online gaming, and horse racing is yet to be submitted.

As BQ Prime had previously reported, GoM member states are expected to submit their suggestions individually, as they failed to reach a consensus on the valuation mechanism for levying GST, when they met on Nov. 22.

A uniform 28% GST is expected to be levied on all three sectors, while the decision on the valuation mechanism remains unknown until the final report is submitted.

The monetary threshold for initiating prosecution for cognisable and non-bailable offences under the GST Act is also expected to be part of the discussion.

According to the official quoted above, a law committee representation for raising the threshold of cognisable and non-bailable offences under Section 132 of the Central GST Act from Rs 5 crore to Rs 20 crore has been submitted and will be considered in the upcoming council meeting.

The representation follows a long-standing industry demand for decriminalisation of offences by raising the threshold amount for launching criminal proceedings and initiating prosecution only in definitive cases of fraud. This would promote ease of doing business for small businesses, according to Bimal Jain, partner in indirect taxes at PHDCCI.

A representation for reducing the GST rate on health insurance from 18% to 12% was received as well, the official quoted above said. This would be referred to the GoM on Rate Rationalisation under Karnataka Chief Minister Basavaraj Bommai.

The final report on rate rationalisation is still due. Interim changes approved by the committee were approved at the last meeting in Chandigarh.