Chidambaram to meet state FMs on Feb 14 on GST rollout

Union Finance Minister P Chidambaram will meet state finance ministers in New Delhi on February 14 to seek their approval on design of GST so that a broad outline of the indirect tax regime can be included in the next Budget.

After holding discussions with states, sources said, Chidambaram is likely to recommend certain changes in the Goods and Services Tax (GST) Bill to the Parliamentary Standing Committee on Finance.

Chidambaram had recently told state finance ministers that he would include a broad outline of the Constitution Amendment Bill on GST in his Budget speech if there was a consensus.

The Union Budget is scheduled to be presented on February 28.

Last month in Bhubaneshwar, the Empowered Committee of State Finance

Ministers had reached a broad consensus on the design of GST, under which the states will be free to decide on the time of its introduction.

The Empowered Committee also decided to suggest to the Finance Ministry incorporation of provisions for allowing states to opt out of the GST fold, thereby making it optional.

Moreover, states had agreed to a lower payment of Rs 34,000 crore (Rs 340 billion) for phasing out the Central Sales Tax, a pre-condition for rollout of the GST.

Besides, they had agreed that instead of a single rate for GST there would be a floor rate with a band, giving freedom to states to fix their own rates.

The February 14 meeting also assumes significance as the Centre is in the process of firming up indirect tax proposals for the Budget.

Complete coverage: Union Budget 2013-14