The next meeting of the Goods and Services Tax (GST) Council may not take place before late May or June, as state governments remain occupied with their respective budget sessions and legislative processes, delaying the Centre’s efforts to fix a date for the 56th Council meeting, sources familiar with the matter told CNBC-TV18.
Under its mandate, the GST Council is expected to meet once every three months. The delay in convening a meeting has sparked concern among businesses and tax experts, who warn that the absence of regular engagement is impacting clarity on several critical issues — from rate rationalisation and classification anomalies to compliance bottlenecks and refunds.
Najib Shah, former Chairman of the CBIC, told CNBC-TV18, “It has been four months since the last GST meeting was held. The Centre was undoubtedly busy with the Union Budget, but it is important that the Council meets now. This will be the first meeting of 2025. The FM had indicated in March that there will be a decision on tax review soon.”
He added that the long-pending merger of GST rates needs to be debated with a clear roadmap, and the delay in setting up the GST Appellate Tribunal (GSTAT) continues to hurt both taxpayers and the government.
An tax expert, noted that industries are awaiting decisions on “clarifications on post-sale discounts, broader coverage under amnesty schemes, extension of compensation cess, taxability of services tied to food delivery platforms,” as well as discussions on slab reduction and rate rationalisation.
Experts also said the multiplicity of tax rates remains a sticking point. “This is an issue about which there has been constant criticism, where everybody has an opinion — and we still do not know what the Council thinks about the issue,” one policy watcher noted.
While a Group of Ministers (GoM) has submitted an interim report on rate rationalisation, observers believe a holistic discussion must occur at the Council level. There are also calls for a dedicated session focused solely on this matter.
Industry bodies have stressed the importance of a phased roadmap for rate changes, allowing businesses sufficient time to adjust and avoid future anti-profiteering investigations.
Despite the Council’s earlier success in streamlining GST through various reforms, experts say momentum has faded. “Regulation 6 of the ‘Procedure and Conduct of Business Regulations of the GST Council’ stipulates that the Council is to meet at least once in every quarter. However, since June 2022, the frequency of such meetings has spiralled down,” said an expert who declined to be named.
Another tax expert added, “The good work done so far by the GST Council needs to continue by conducting regular meetings to immediately address key concerns such as introduction of sectoral focus committees, levy of GST on virtual digital assets… practical implementation of Section 11A, and reduction of GST rates in the health and life insurance sector.”
The industry is also seeking reform in exemptions, with many experts arguing that they disrupt value chains and invite lobbying. The Council, they suggest, should take a broader view and minimise exemptions to uphold the GST’s core principles.
Other compliance-related concerns remain unresolved. These include delays in GST registration, despite recent CBIC circulars, and refund delays, which continue to frustrate businesses. Experts suggest that interest on delayed refunds should be standard practice and data from states and CBIC should be reviewed to ensure timely processing.
On the long-pending issue of GSTAT, stakeholders say that even after the appointment of a President in May 2024, delays in appointing members continue to stall the tribunal’s operationalisation, increasing litigation costs and taxpayer uncertainty.
“There are a lot of GST-related issues to be addressed, and the industry expects the GST Council to meet frequently for resolving those,” another tax expert said. “Apart from rate rationalisation, clarity is awaited on many contentious issues, including availability of input tax credit (ITC)… There are also issues pertaining to ease of doing business, including delays in refunds, return filing, scrutiny, investigations and so on.”
The divergence in Advance Rulings (AARs) across states has further muddied the waters. Experts argue for the creation of a National Authority for Advance Rulings, to prevent conflicting interpretations and ensure legal consistency.
Another tax expert noted that, “More urgently, the divergence in AARs across states is leading to uncertainty… This inconsistency makes it difficult for businesses to navigate the tax landscape.”
The 55th GST Council meeting was held in December 2024 in Jaisalmer. Since then, discussions on GST rates for insurance, real estate, gaming, and other sectors remain pending. With rising pressure from stakeholders, the government is now expected to convene the next meeting no later than June 2025, according to sources.
