Goods and Services Tax (GST) bill, which was stuck in Parliament since a long time, has finally been passed with over 2/3 majority. Rajyasabha unanimously passes key GST Bill, Not only Congress, but other major political parties showed support for GST, as a result of which, the bill has finally been passed.
Barring AIADMK, the bill was supported by all the o0ther major political parties. As per the reports, all the four GST amendments have been passed in Rajya Sabha.
This has come as a huge success for the NDA government at the Centre. GST was long awaited to be passed, but after discussing all of its pros and cons, the bill has finally been passed.
One India, one tax, but will the GST prove to be the miracle India needs? Will it generate employment and increase business activity and the GDP itself? What will be costlier and what will be cheaper?
Introducing the GST bill in the parliament FinMin said that “This is one of the most significant tax reforms in India in recent history. This reform has been debated within the political and economic system of India for almost 15 years,”
“I am sure the enactment of the GST will bring out the best as far as economic management. It will empower the states, increase revenue of the states and the central government, provide a boost to the economy and bring down tax evasion and eliminate tax on tax,” he added.
Now this GST bill is to be ratified by atleast 50% of the states to come in to existence. Then GST council be formed consisting of state finance misters and union finance misters which will take important decisions like threshold rates and dual control.
Thereafter, two legislations—central GST and integrated GST will have to be passed by Parliament and a state GST legislation by the state legislatures.
Also Read: GST bill summary
By the demand of the opposition party now central government will have to keep the tax rates in the constitution amendment. GST bill that will be subsequently brought in the parliament will have cap rate of 18%.
As P. Chidambaram said GST rate being an indirect tax should be kept as low as possible as it impacts everyone irrespective of their income levels. Citing the report of the chief economic advisor Arvind Subramanian, Chidambaram pushed for a standard rate of 18% for most goods and services.
GST rate being an indirect tax should be kept as low as possible as it impacts everyone irrespective of their income levels. Citing the report of the chief economic advisor Arvind Subramanian, Chidambaram pushed for a standard rate of 18% for most goods and services.
Passage of the constitution amendment bill in Rajya Sabha paves the way for the implementation of GST from the next fiscal year. The government was aiming to implement GST from 1 April 2017 but may delay it by a few months to ensure a smooth implementation.
The constitution amendment bill received Lok Sabha’s nod in May last year but was stuck after the Congress party insisted that three of it demands—capping the GST rate in the bill at 18%, doing away with the additional 1% tax and the need for an independent dispute resolution authority. The government subsequently acceded to the Congress’ demands of removing the 1% tax and changed the language of the dispute resolution clause marginally.