- The GST Council in India has been working to align the country’s tax laws with international best practices and make it a more business-friendly jurisdiction.
- One area of interest has been the question of interest liability, which is levied at 18% per annum on delayed payment of tax and utilisation of wrongfully availed credit under India’s GST law.
- The authors of the article argue that interest should be compensatory rather than punitive, and the GST Council has rationalised interest rates and provisions accordingly.
- The Council has also made amendments to Section 50(3) and introduced a proviso to Section 50(1) of the Central Goods and Services Tax (CGST) Act to further rationalise interest provisions.
Source International Tax Review
