Administrative Framework

Administrative Framework of GST in India

Administration of GST

The administration of GST in India is a collaborative effort between the central and state governments. It involves various bodies working together to ensure the smooth implementation and operation of the GST system.

• GST Council: The apex body for decision-making on GST matters.
• Central Board of Indirect Taxes and Customs (CBIC): Responsible for administering CGST and IGST at the central level.
• State GST Departments: Responsible for administering SGST within their respective states.
• GST Network (GSTN): A non-profit, non-government organization that provides the IT infrastructure and services for the GST system.

GST Council

The GST Council is a constitutional body established under Article 279A of the Constitution of India. It is the key decision-making body for all GST-related matters.

Formation:

• The GST Council was formed after the 101st Constitutional Amendment Act, 2016.
• It was constituted by the President of India within 60 days of the commencement of Article 279A.

Composition:

• Chairperson: Union Finance Minister
• Members:
  • Union Minister of State in charge of Revenue or Finance
  • Minister in charge of finance or taxation of all the States

Powers and Functions:

The GST Council is empowered to make recommendations to the Union and State Governments on various GST-related matters, including:

• Taxes, cesses, and surcharges: Recommending which taxes should be subsumed under GST.
• Goods and services: Deciding which goods and services should be subject to or exempt from GST.
• GST laws: Formulating model GST laws, principles of levy, and apportionment of GST.
• Threshold limits: Determining the threshold limit for GST registration.
• GST rates: Recommending GST rates, including floor rates with bands.
• Special rates: Proposing special rates during natural calamities or disasters.
• Special provisions: Recommending special provisions for certain states (North Eastern states, Himachal Pradesh, Jammu and Kashmir, and Uttarakhand).
• Compensation to states: Recommending compensation to states for revenue loss due to GST implementation.

Decision-Making:

• Decisions in the GST Council are taken by a majority of not less than three-fourths of the weighted votes of the members present and voting.
• The vote of the Central Government has a weightage of one-third of the total votes cast.
• The votes of all the State Governments together have a weightage of two-thirds of the total votes cast.

Significance:

The GST Council plays a crucial role in the successful implementation of GST in India. It ensures cooperative federalism by bringing together the central and state governments to make decisions on GST-related matters. The Council's recommendations have helped to create a unified and efficient indirect tax system in India.