GST Council chairman and finance minister Arun Jaitley lays speculation to rest on tax rates

Finance minister Arun Jaitley said on Friday that there won't be "surprises" in the fixation of Goods and Services Tax (GST) rates that seek to replace a plethora of existing state and central indirect taxes from July 1 this year.

"We are now in final stages of fixing tariffs for different commodities. The formula under which it is being done has also been explained and therefore nobody is going to be taken by surprise, it's not going to be very significantly different (from present)," Jaitley said at the annual meeting of industry body CII in New Delhi, reports news agency PTI.

Jaitley, who heads the GST Council, the highest decision-making body that will be fixing the tax rates for goods and services in the four slabs — 5, 12, 18 and 28 percent — will be chairing the 14th meeting of the Council on May 18 and 19 in Srinagar to finalise the rates.

Besides the rates, another aspect that will occupy centrestage is the "security" issue of the GSTN, or GST Network, the IT backbone of the indirect tax mechanism. The issue was first raised by BJP MP Subramanian Swamy last August and again during the debate in the Rajya Sabha early this month.  

His principal opposition stems from the the shareholding pattern of the GSTN; while the Centre and the state governments have a total ownership of 49 percent, the rest is owned by private entities HDFC, HDFC Bank, ICICI Bank, NSE Strategic Investment Company and LIC Housing Finance. Therefore, it can't be subject to audit by the CAG or fall under the ambit of RTI.

"This is a kind of a shady organisation that is coming into being," Swamy said in the Rajya Sabha while participating in the debate on passing the four enabling GST legislations on April 5. He sought to know if it would be restructured as recommended by a house panel that wanted the ownership to rest with state-owned banks and institutions.