New Delhi | Jagran Business Desk: Union Finance Minister Nirmala Sitharaman on Friday chaired the crucial 43rd goods and service tax (GST) council meet. The meeting, which is being held after nearly eight months, is being held virtually and being attended by Minister of State for Finance Anurag Thakur and officials and ministers from all states and union territories (UTs).

Sitharaman had held the last GST council meeting on October 5 last year where she had simplified the GST return filing system and made recommendations to release the compensation payable to states.

Here's what we can expect from the 43rd GST Council Meet:

GST on COVID essentials

The second wave of the COVID-19 pandemic has led to an acute shortage of medical essential to treat coronavirus patients in the country. Amid this, several opposition-ruled states -- West Bengal, Maharashtra, Kerala, Rajasthan, Punjab, Jharkhand, Tamil Nadu and Chhattisgarh -- have prepared to corner the government over the issue and demand a zero tax rate on COVID essentials.

However, this wish of states is unlikely to be fulfiled as Finance Minister Nirmala Sitharaman last month had ruled out exempting Covid vaccines, medicines and oxygen concentrators from GST, saying such an exemption will make the lifesaving items costlier for consumers as manufacturers will not be able to offset the taxes paid on inputs.

Currently, domestic supplies and commercial imports of vaccines attract a 5 per cent GST while COVID drugs and oxygen concentrators attract a 12 per cent levy.

GST compensation to states

With the economic uncertainty continuing due to the second wave of the COVID-19 pandemic, the issue of GST compensation to states is expected to rock the GST council meet once again on Friday. According to a report by news agency ANI, states want an extension of the GST compensation beyond July 2022.

Currently, the shortfall in GST compensation payable to states is around Rs 2.69 lakh crore. However, the Centre is expecting to collect over Rs 1.11 lakh crore through cess on luxury, demerit and sin goods which will be given to the states. However, the remaining Rs 1.58 lakh crore is expected to be borrowed to meet the promised compensation.

Extension of GST filing deadlines

It is expected that Sitharamand will also discuss a possible extension of GST filing deadlines. Earlier this month, the Centre had given a breather to thousands of salaried class people in the country by extended the timelines of various GST compliance for March and April after India got hit by the second wave of the COVID-19 pandemic.

"Authorities should be directed to be very discreet before they arrest traders or attach their bank accounts or summon them for statements. There is an atmosphere of panic in the trade and these actions will further create a crisis unless there are very pressing and urgent reasons and justification for doing so," said traders' body CAIT, as reported by news agency PTI.

Time-bound rate cut to boost consumption

Ahead of the meet, the demands to consider a time-bound rate cut to boost consumption have also increased. Business experts want the Centre to consider a time-bound rate cut, saying it will have a positive impact as consumers will prepone their expenditures.

"We have seen that when states announced concessions on stamp duty, consumers preponed their real estate purchases. So if GST Council gives this time-bound rate cut relief, people will prepone their purchasing that will boost consumption," Kotak Mahindra Asset Management Managing Director Nilesh Shah told ANI.

Posted By: Aalok Sensharma