Who among the following was appointed as head of the seven member committee to look into revenue shortfall being faced by the states after the GST roll-out in India and suggest steps for augmenting collections?

Question

Prepp Team · Accepted Answer

Understanding the GST Revenue Shortfall Committee

Following the implementation of the Goods and Services Tax (GST) in India, many states reported facing a shortfall in their revenue collections. To address this concern and explore ways to boost collections, the Goods and Services Tax Council decided to form a special committee.

Formation and Purpose of the Committee

The GST Council constituted a seven-member committee specifically tasked with:

Identifying the reasons behind the revenue shortfall experienced by various states after the GST rollout.
Suggesting measures and strategies to improve GST collections and augment state revenues.

This committee was crucial for understanding the ground-level impact of the new tax regime on state finances and recommending corrective actions.

Head of the Committee

The question asks who was appointed as the head of this important seven-member committee. Among the options provided, Shri Sushil Modi, who was the Deputy Chief Minister and Finance Minister of Bihar at the time, was appointed to lead this committee.

His role as the head involved overseeing the committee's deliberations, guiding its study into the revenue issues, and finalising the recommendations to be submitted to the GST Council.

Analysing the Options

Let's briefly look at the options provided in the question:

Himanta Biswa Sharma: A prominent political leader, currently Chief Minister of Assam. While involved in GST discussions, he was not appointed head of this specific committee.
Thomas Isaac: Former Finance Minister of Kerala. An active participant in GST Council meetings, known for his views on federal fiscal issues, but not the head of this committee.
Sushil Modi: Former Deputy Chief Minister and Finance Minister of Bihar. He was indeed appointed as the head of the seven-member committee on GST revenue shortfall.
Capt Abhimanyu: Former Finance Minister of Haryana. Also participated in GST Council meetings, but did not head this particular committee.

Therefore, based on the appointments made by the GST Council, Sushil Modi was the correct individual appointed as the head of the committee formed to look into the revenue shortfall faced by states after the GST roll-out.

Committee Aspect	Detail
Purpose	To study state revenue shortfall post-GST and suggest augmentation steps
Number of Members	Seven
Head	Sushil Modi

Revision Table: Key Points on GST Committee

Term	Explanation
GST Roll-out	Implementation of Goods and Services Tax in India (July 1, 2017)
Revenue Shortfall	When actual tax collection is less than projected or required amount
GST Council	Apex decision-making body for GST in India, comprising Union Finance Minister and state finance ministers
Seven-Member Committee	A group formed by the GST Council to address specific issues (in this case, state revenue shortfall)
Sushil Modi	Appointed head of the committee on state revenue shortfall

Additional Information: Role of GST Council and State Finances

The GST Council plays a crucial role in the functioning of the Goods and Services Tax in India. It is a constitutional body responsible for making recommendations to the Union and State Governments on issues related to GST.

One of the initial concerns after GST implementation was the potential impact on the revenues of state governments. The GST Compensation Cess was introduced to compensate states for any revenue loss due to the transition to GST for a period of five years (until June 2022), calculated based on a projected 14% annual growth over the 2015-16 base year.

However, states still faced challenges, leading to the formation of committees like the one headed by Sushil Modi to continuously monitor and address revenue-related issues and suggest improvements in tax administration and policy to ensure adequate collections.