Centre agrees to phased roll-out of a diluted GST as states toughen stand

The central government has agreed to some key changes in the proposed goods and services tax (GST), giving hope of implementation of a diluted version of the new indirect tax system.

Instead of its earlier proposal for uniform GST rates across the country, the central government has now agreed to a floor rate of taxation with a narrow band.

Petroleum products, which were kept out of GST in constitution amendment bill, would also be made part of GST. States will also get powers to raise additional resources in the time of a natural calamity.

There will be a special scheme for North Eastern states and Jammu & Kashmir.

A day after the states agreed to a reduced compensation for losses on abolition of the central sales tax, the centre today agreed to a phased roll-out of the GST.

This means that willing states could switch over to the new indirect tax system from the beginning of the next financial year.