Overview

• The GST Council convenes on September 3–4 to consider winding up the pandemic-era compensation cess ahead of the earlier March 2026 timeline.
• Officials expect the Centre’s COVID-era loans for state compensation to be fully repaid around October 18, with collections likely continuing until October 31 to settle accounts.
• A residual surplus of roughly Rs 2,000–3,000 crore is projected in the cess pool, to be shared equally between the Centre and states under the 2017 Act.
• A Group of Ministers has recommended ending the levy by October 31 and outlined options including folding current cess goods into standard GST rates or a targeted additional levy sought by some states such as Tamil Nadu, Karnataka and Punjab, with West Bengal flagging a possible CGST amendment.
• Separately, the Finance Ministry has proposed collapsing four GST slabs into two rates—5% and 18%—which the Prime Minister has framed as price relief for households.