In its 30th meeting, GST Council on Friday formed a group of minister to look into Kerala government's cess proposal, the details of which will be shared in the next two days, said Kerala's finance minister Thomas Isaac.
He said that the council was hopeful that the revenue will pick up in the state as the revenue gap was decreasing.
The Kerala government has requested for allowing to levy a 10 percent cess to raise revenues for flood related rehabilitation works.
"The constitution provides for imposition of cess to help states in emergency conditions," said the the finance minister, referring to the recent floods that caused severe damage to life and property in the state. The loss due to the floods is pegged at about Rs 20,000.
The council also discussed 1 percent pan India tax in commodities, said Isaac.
A detailed presentation was made with regards to GST revenue position, said finance minister Arun Jaitley, adding that the council secretary visited revenue deficit states and analysed the situation.
Jaitley said that the consuming states of north east were not facing revenue deficit and added that GST collections for many of these states were above expectations.
The finance minister said that the state deficit that the centre was looking to neutralise was 16 percent in the first year of the new tax regime.
Jaitley added that the deficit "may reduce as the consumption is picking up".