Compensation for States to support a harmonised GST implementation to preserve revenues and enable uniform national tax procedures.
The speech urges a harmonised, dual GST subsuming major Central and State indirect taxes with minimal rates and limited exemptions, coupled with uniform procedures for levy, assessment, collection and dispute resolution to create a national common market. It stresses robust IT-based inter state verification and coordinated information sharing to prevent arbitrage, pragmatic reform of checkposts, and careful treatment of thresholds and composition regimes for small enterprises. The Finance Commission indicates willingness to consider a compensation mechanism for States to support implementation of a harmonised, "flawless" GST.