NEW DELHI: The Cabinet today cleared the process, formation and functioning of the GST Council, which will decide on the rate of tax under the new indirect taxation regime.
The Council, to be headed by Finance Minister Arun Jaitley and comprising of representative of all 29 states and two union territories, will have to be set up by November 11.
It will decide on the tax rate, exemptions and threshold limits in the new indirect tax regime, which is expected to kick in from April 1, 2017.
The government has notified September 12, as the date from which the procedure for setting up of the GST Council will be initiated and which will be completed within 60 days.
According to sources, the Cabinet headed by Prime Minister Narendra Modi today approved the process, formation and functioning of the GST Council.
The Cabinet also decided on the constitution of the GST Secretariat and the officers who will implement the decisions of the Council.
The GST Council will be chaired by Union Finance Minister and have a Minister of State for Finance and all state finance ministers as its members.
While the Centre will have one-third vote, states together will have a two-third say. To adopt a resolution, three-fourth majority would be required.
The approval came on the day when the Constitution Amendment Act on GST came into effect.
President Pranab Mukherjee gave his assent to the bill last week, paving the way for setting up of a GST Council.
GST is a single indirect tax, which will subsume most of the central and state levies such as Value Added Tax (VAT), Excise Duty, Service Tax, Central Sales Tax, additional Customs Duty and special additional duty of customs.