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Published: June 22, 2024
Updated: June 22, 2024

53rd GST Council Meeting: Key Expectations for Simplified Compliance and Economic Growth

Focus on Streamlining GST and Enhancing Compliance

The 53rd GST Council meeting, scheduled for June 22, is poised to tackle critical issues aimed at refining the GST framework, improving compliance, and addressing industry concerns. Ankur Gupta, Practice Leader - Indirect Tax at SW India, emphasized the meeting's significance.

Rate Rationalization and Inverted Duty Structure

A primary topic of discussion is expected to be rate rationalization, which could involve reducing GST rates on specific goods and services to boost consumption and provide relief to businesses. Additionally, the Council is likely to address the inverted duty structure, which currently causes input tax credit accumulation issues in certain sectors.

Positive Sentiments Towards GST Implementation

Mahesh Jaising, Partner and Leader, Indirect Tax at Deloitte India, shared insights from recent surveys reflecting positive sentiments toward GST implementation. According to Deloitte India's GST@7 survey, 78 percent of MSMEs have expressed a positive sentiment towards GST this year, up from 66 percent in 2023. Moreover, 70 percent of respondents believe that quarterly filing of returns for MSMEs improves compliance and enhances supply chain efficiencies.

Support for Continued Reforms

The survey also indicates strong support for further GST reforms. Key areas for improvement include rationalizing tax rates, enhancing dispute resolution processes, removing credit restrictions, adopting faceless assessments, liberalizing export rules, and implementing a compliance rating system. Jaising noted that India's corporate sector has increased confidence in the GST regime, highlighting the benefits of tax technology and ongoing stakeholder engagement.

Impact on Real Estate Sector

Amit Goyal, Managing Director at India Sotheby's International Realty, remarked on the positive impact of political stability on the Indian economy and the real estate sector. With the current government in power, confidence among consumers and investors has grown, particularly benefiting the luxury real estate segment. Goyal highlighted India's potential to become the third-largest global economy by 2027, with strong demand for homes driven by infrastructure development and policy stability.

Supporting MSMEs

The Deloitte survey also suggested measures to support the MSME sector, such as easing GST registration through virtual verification and standardized documentation. These initiatives aim to help MSMEs navigate compliance challenges more effectively, contributing to India's economic growth.

Real Estate Sector Expectations

Badal Yagnik, CEO of Colliers India, emphasized the real estate sector's expectations for continued structural reforms and policy support. He highlighted the impact of RERA and GST implementation, national policies for logistic parks and data centers, and the National Infrastructure Pipeline and Gati Shakti National Master Plan. Yagnik stressed that these long-term measures are crucial for driving equitable public and private investment in the economy, helping the real estate sector reach a USD 1 trillion market and contributing 13-15% of India's GDP by 2030.

The 53rd GST Council meeting is expected to bring significant advancements in the GST framework, addressing key industry concerns and promoting economic growth. With a focus on rate rationalization, compliance enhancement, and support for MSMEs, the meeting's outcomes could have far-reaching impacts on various sectors, including real estate, contributing to India's overall economic development.