A journey of a thousand miles begins with a single step. The launch of GST on July 1, 2017 was one such step in the economic transformation of India. That the decision of unification of the indirect tax regime in the country was taken by the collective wisdom of all the states and the Centre makes it even more significant. The driving force for this was the 101st Constitutional Amendment Bill, which paved the way for the constitution of the GST Council with the Union finance minister as chairperson and MoS (finance) and ministers in charge of finance or taxation of states as members.

As the Council gears up for its 50th meeting, it can take pride in the exemplary way in which the meetings have been steered and decisions have been taken. Since its inception on September 15, 2016, the GST Council met 17 times before the rollout of GST to finalise laws, rates, and procedures to complete the preparation for its launch. The objective was to evolve a system that benefits all the stakeholders—the taxpayers, tax administrators, and the common citizen.

The process of making the biggest indirect tax reform successful was by no means easy. The taxpayers had to be facilitated to adapt to the new system. This meant giving them clarity on the law, tax rates, and so on. The Council has striven to achieve these objectives. Space constraints may not permit detailing all important decisions taken by the Council. But some do merit a mention.

The E-invoicing system has not only eased the filing of returns but also relieved the requirement of carrying hard copies during the transit of goods. Initially introduced for taxpayers with a turnover of more than Rs 500 crore from January 1, 2020, it has progressively been extended and is scheduled to cover all taxpayers with a turnover of more than Rs 5 crore with effect from August 1, 2023.

Steps have been taken to facilitate small and medium taxpayers. The annual turnover threshold for suppliers of goods who could come under the composition scheme was increased to Rs 1.50 crore, up from Rs 75 lakh at the time of implementation of GST. For suppliers having a turnover of less than `5 crore, Quarterly Return Monthly Payment (QRMP) was introduced, allowing them to file quarterly returns significantly reducing their compliance burden.

The Council has also taken numerous decisions to extend the dates for filing returns, refund forms, waiver of late fees, approving additional modes for payment of tax, and more, keeping in view the convenience of the taxpayers.

A game changer has been the e-way bill system, which has brought about huge logistical efficiencies and savings for businesses by eliminating manual checking of waybills at check posts on state borders.

The GST Council has assiduously worked on rationalising rates to ease the tax burden on citizens. Since as early as November 2017, tax rates for 178 items under the 28% slab were rationalised. Subsequently, GST rate for affordable housing was pegged at 1%, which has been a significant incentive for developers to invest in this sector. During the Covid pandemic, the GST Council rationalised rates on specified Covid-related goods, helping increase the availability of critical equipment and medicines required for treatment.

During the last six years, the responsiveness of the Council to the difficulties of the taxpayer by constituting a committee to look into their grievances has resulted in a sharp reduction in the number of complaints to the usage of the system from 83 per 10,000 users to less than 4, per a working paper by the Economic Advisory Council to the prime minister.

The decisions have shown positive results in virtually every parameter by which the success of the GST regime can be measured. The on-time filing compliance of tax payment returns by taxpayers has shown a consistent upward movement and is currently around 76%, while the taxpayer base has increased from 44.35 lakh taxpayers to 1.40 crore taxpayers who migrated from the old tax regime as on June 30, 2023. GST revenues have grown steadily from Rs 7.40 trillion in 2017-18 to Rs 18.07 trillion in 2022-23.

It needs no emphasis that all this has been achieved with political diversity, which is the inherent feature of Indian democracy. It is indeed a marvel that decisions impacting taxpayers and those for the benefit of the common man were all taken in a non-partisan manner. Arriving at 1,500 decisions on tax policy and rates in a consensual manner with the Centre and the states over the course of 49 meetings is unparalleled by any standard. The GST Council is a shining example of the spirit of cooperative federalism as it meets for the 50th time. It can be proud of its legacy and of the fact that the GST architecture it deliberates during the meeting is a much improved and evolved version of the one it started the journey with.