Law and Legal blog

The 13th Finance Commission, Government of India has created a Task Force (TF) to make recommendations on various issues relating to the design and implementation of Goods and Services Tax (GST) in India. The Task Force undertook the study for 18 months and submitted its report yesterday (December 15, 2009). The following is the extract from the recommendations of the TF. Need for GST As the current methodology of taxation of goods and services is characterized as cascading and creates distortion, it is necessary to replace the existing indirect tax system by a new regime which would foster the achievement of the following objectives: • The incidence of tax falls only on the domestic consumption; • The efficiency and equity of the system is optimized; • There should be no export of taxes across taxing jurisdictions; • The Indian market should be integrated into a single common market; • It enhances the cause of cooperative federalism. Flawless GST The TF has recommende...