Bangalore: The central government on Thursday proposed to impose GST on all private companies with a turnover exceeding Rs 10 lakh in the city.
The proposal comes as the Karnataka government is trying to recover some of the funds diverted by multinational companies from the state in a scheme which has been dubbed the ‘GST miracle’.
The Central GST Council, which is charged with implementing GST on the central government’s behalf, will take up the issue on Tuesday.
The GST Council’s chairman is former Chief Minister Siddaramaiah.
It will also submit a report on the issue to the central cabinet.
The Karnataka Cabinet will have to approve the final draft of the GST bill.
The GST Council is expected to recommend the GST rate to the Karnan government.
It has to have the final say over the proposed rate, which will need to be approved by the Supreme Court, which last week rejected the Centre’s proposal to set the rate at 6%.
The Central government’s proposed GST rate of 6% has been criticised by many quarters.
The Centre has not clarified whether the proposed tax rate will be 6% on all goods or goods with a fixed price.
The Central government has been pushing the proposal to the states and central corporations.
The central government has also been trying to convince states to give the central GST rate a boost by bringing back tax incentives to businesses.
The central GST Council has been working for several years to develop GST as a national tax system.
The council has already recommended a rate of 5%.