Announcement Date: October 19, 2016
The GST Council reached a consensus on state compensation; the base year will be 2015-16. A four-tier rate structure comprising a lower rate of 6%, two standard rates of 12% and 18%, and a higher rate of 26% with an additional cess for luxury and demerit goods were proposed in the third meeting of the GST Council. Such cess has been proposed to be used for payment of compensation to the States. However, consensus could not be reached. The Finance Ministry has set the November 22 deadline for building consensus on all issues in the Council. The next meeting of the Council has been decided for November 3-4.