GST Compensation Cess Report Delayed: GoM Seeks Extension

The Group of Ministers on GST compensation cess, led by Minister Pankaj Chaudhary, plans to request an additional six months to submit their report to the GST Council. The report, crucial in deciding the future of the cess beyond 2026, evaluates legal aspects and revenues affected by COVID-19.

The Group of Ministers (GoM) responsible for assessing the GST compensation cess has announced plans to seek a six-month extension from the GST Council for their report submission, according to an official source.

Initially required to submit their findings by December 31, the GoM, with representatives from several states, cited complex legal considerations as the reason for the delay. "There are many legal issues involving the compensation cess matter and various facets of law need to be analyzed thoroughly," the official stated.

The extension, expected to range from five to six months, comes as the GST Council evaluates the cess initially set to end in March 2026. The cess, collected on select luxury and demerit goods, funds state reimbursement for GST-related revenue declines, a critical aspect especially post-COVID-19 fiscal years.

(With inputs from agencies.)