When the Goods and Services Tax (GST) was set up as a single, multi-stage, comprehensive tax collection system, it also required the establishment of governing bodies to oversee its proper administration. The GST Council or Goods and Services Tax Council was likewise set up as an apex body in shaping GST rules and regulations, GST laws and procedures, and in managing GST implementation and administration across the country. Here we understand what is GST Council, its structure, purpose and importance in India’s tax infrastructure.

For more details, view the GST Council website: //gstcouncil.gov.in/

What is GST Council?

The Goods and Services Tax Council or GST Council is the apex government body for all matters related to GST in India. Its primary purpose is to ensure there’s uniformity in GST administration across the country and reduce challenges related to its implementation.

Based on the country’s economic needs and challenges, it decides on GST rate structure, exemptions, rules, and laws that would govern GST implementation. The Council meets periodically to review existing rules and makes amendments for GST’s optimal functioning.

On 22 June 2022, the 53^rd GST Council meeting was held where there were discussions and recommendations on several matters such as:

• Making changes to GSTR-1 for current tax period (i.e., via the new GSTR-1A form)
• Relaxation on GST ITC claims (as per amendments made to Section 16(4))
• Revision of filing date for GSTR-4 for taxpayers under the GST Composition Scheme (i.e., revised to 30 June 2024)
• Filing of GSTR-7 made mandatory even when there has been no deductions for TDS under GST
• Waiver of penalties and interests for specific GST notices (i.e., demand notices for FY17-18)
• Revision on GST rates and GST exemptions on specific items

*Image for representation purpose only. Not actual. 

What is the structure of the GST Council in India?

The GST Council structure has been designed keeping in mind the contribution and role of the centre and state/UT administration and local tax authorities in the GST framework. As per Article 279A of the amended Constitution, the GST council will be a joint forum of the States and the Union and will have members from the same.

Below is a snapshot of its current structure:

Apart from these members, the GST Council also has:

• Secretary (Revenue) as the Ex-officio secretary to the GST Council
• Chairperson of CBEC (Central Board of Excise and Customs) as a permanent invitee (Note: Non-voting)
• Additional Secretary to the GST Council
• Commissioner in the GST Council (Total 4 posts)

The structure of the GST Council such designed streamlines tax administration promoting transparency, fairness and efficiency in the GST system. It’s a collaborate approach where every member contributes to building a harmonious tax environment.

Also read: Features of GST – What makes it unique

GST Council meetings: How does the GST Council work?

Understanding the workings of the GST Council, i.e., its meetings and how it operates is important. It is after all responsible for the administration, implementation and collection of GST taxes. And changes in its rules, laws, and implementation therefore has direct impact on revenue, taxes, and the economic system of the country.

Here’s a brief overview of how GST Council works and functions:

• GST Meetings and Quorum: Council meetings are held periodically as determined by the Chairperson. It can also be held when it’s requested by the majority of members or when there’s the need for it. Its quorum or minimum member required is set to 50% to ensure that decisions made are done collaboratively and with the consent of the majority of present members.
• Decision making: General consensus/agreement must be met for decisions to be made. If not, Centre and States can vote to come to a decision. In terms of weightage, each state has one vote, with the centre’s vote equivalent to 1/3^rd of all votes cast. This means, that for any resolution to pass, the votes in favour must equal to at least 3/4^th of the weightage of votes cast.
• Members role: Since the GST Council consists of representatives from different states/UTs and the Centre, it makes provision for discussions on economic and taxation matters that have an impact at regional and national levels.

What is the role of the GST Council in India?

The role of the Goods and Services Tax Council in India is manifold across the governance of the GST system nation-wide. Listed below are some of the key roles and responsibilities of the GST Council members.

• Determine tax rates: The key role of the GST Council is to determine the tax rate slabs for various goods and services, along with the CESS charges and surcharges
• Amend and approve GST laws: The Council also has the authority to recommend changes in GST laws and rules, and approve any GST rules (e.g., process of GST registration) for simplifying operations and implementations
• Determine policies: For matters related to GST administration (e.g., technology adoption for GST portal), the GST Council can also provide direction on policy matters that benefits all entities (taxpayers and the authorities)
• Resolve disputes: When it comes to disputes between Union, States or any entity and GST, the Council can intervene to resolve conflicts and disputes to ensure harmonious operations
• Bring uniformity: The role of the Goods and Services Tax Council is also to bring uniformity in tax administration and implementation across different states, UTs and the centre to reduce complexities and simplify the taxation system

*Image for representation only. Not actual. 

GST Council recommendations

The GST Council issues recommendations from time to time for smooth functioning of the Goods and Services Tax systems. According to Article 279(A) there are several areas in which the GST Council can make recommendations. They also highlight the GST laws that impact threshold limits, normal and special GST rates, and more.

There are other areas where recommendations can be provided. These include:

• Adjustments in tax rates (regular and special rates) based on economic realities and fairness to businesses across different states and turnover levels
• Propose tax reliefs and exemptions for specific products/services and sectors to promote growth
• Simplify processes and procedures for easier adoption of GST (e.g., simplifying registrations, returns filing, grievance redressal, GST appeals, etc.)
• Introduce strict measures and scrutiny processes to curb tax evasion (e.g., introduction of GST e-invoicing, adding GSTN under PMLA Act, etc.)
• Provide clarification on legal aspects of GST rules to ensure ease of compliance (e.g., setting up of GST Seva Kendra centres across states)

These recommendations not only facilitate seamless operations and fairness in the GST system, but also makes it easier for businesses to operate and the government to collect revenues in time.

FAQs

What do you mean by Goods and Services Tax Council?

The Goods and Services Tax Council or GST Council is the apex body responsible for the implementation and administration of GST in India. GST Council meetings are held periodically to discuss matters on GST tax rates, exemptions and rebates, timelines and thresholds, amendments or any other that would facilitate optimal functioning of the GST regime.

Who is included in GST Council?

The GST Council consists of members from the Union and States/UTs. The Union Finance Minister is the Chairperson of the GST Council and there are other members from the States/UTs, namely the Union Minister of State (in charge of revenue of finance) and the Minister in charge of finance or taxation or any other minister nominated by each State government.

How many councils are there in GST?

There are 33 GST Council members in total. Of these, 2 members are from the Centre and the remaining 31 members from the States and Union Territories (those with legislation).

*This article is for information only. For more details, please visit the official GST Council website and GST website. You can also consult with a GST practitioner or CA or tax consultant for professional advice.

Author: Sohini Banerjee

Sohini is a seasoned content writer with 12 years’ experience in developing marketing and business content across multiple formats. At Tata nexarc, she leverages her skills in crafting curated content on the Indian MSME sector, steel procurement, and logistics. In her personal time, she enjoys reading fiction and being up-to-date on trends in digital marketing and the Indian business ecosystem.