Parliament Passes Four Bills To Pave Way For GST Rollout
States will now have to pass the State GST bills.
India’s parliament on Thursday cleared the decks for the rollout of the historic Goods and Services Tax (GST) from July 1 as it approved four supporting legislations to usher in the one-nation-one-tax regime.
The Central GST Bill, 2017; The Integrated GST Bill, 2017; The GST (Compensation to States) Bill, 2017; and The Union Territory GST Bill, 2017 were returned by the Rajya Sabha by a voice vote as all parties were on board.
A number of amendments moved by some opposition parties were negated in the House where the ruling NDA is in a minority.
Significantly, Congress member Jairam Ramesh did not press an amendment he had proposed, saying he had been advised by former Prime Minister Manmohan Singh against it for the sake of consensus.
The Lok Sabha had passed these bills on March 29.
State assemblies will now have to pass the State GST bills after which the new indirect tax regime can be rolled out from the targeted date of July 1.
Replying to the 8-hour-long debate, Finance Minister Arun Jaitley also gave credit to the previous UPA government for the GST.
"I have no hesitation in conceding that it is not a Bill for which one government, one person or any individual should take a credit. It is a collective property in which states, political parties, central government, successive governments have all contributed to it,” said Jaitley, who went to the opposition benches to thank them, particularly Manmohan Singh, for the cooperation.
The GST, the biggest taxation reform since Independence, will subsume central excise, service tax, VAT and other local levies to create an uniform market. It is expected to improve tax revenue collections and boost the growth.
Responding to concerns expressed by the members, Jaitley insisted that the GST will not lead to inflation.
The powerful GST Council, comprising Centre and states, has recommended a four-tier tax structure – 5, 12, 18 and 28 percent. There will be cap rate of 40 percent, Jaitley said.
The GST rates are to be discussed by the GST Council on May 18-19.
Jaitley said once the new regime is implemented, the harassment of businesses by different authorities will end and India will be have one rate for one commodity throughout the country.
On top of the highest slab, a cess will be imposed on luxury and demerit goods to compensate the states for revenue loss in the first five years of GST implementation.