GST Council Forms GoM to Determine Compensation Cess Future
The GST Council has established a 10-member Group of Ministers (GoM) led by Minister of State for Finance, Pankaj Chaudhary. The GoM is tasked with proposing a replacement for the compensation cess, which is set to be abolished. The group will submit their report by December 31.
- Country:
- India
The GST Council has constituted a 10-member Group of Ministers (GoM), chaired by Minister of State for Finance Pankaj Chaudhary, to decide the future of the compensation cess.
This GoM includes representatives from states such as Assam, Chhattisgarh, Gujarat, Karnataka, Madhya Pradesh, Punjab, Tamil Nadu, Uttar Pradesh, and West Bengal, and is expected to present its findings by December 31.
The compensation cess, an additional levy on luxury, sin, and demerit goods, was initially set for five years post-GST rollout to offset states' revenue loss. However, due to revenue shortfalls during the Covid-19 pandemic, its levy was extended to March 2026.
The GoM will recommend a new taxation model to replace the compensation cess.
(With inputs from agencies.)
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