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The NDA government wants to establish the proposed GST Council in six to eight weeks so as not to lose the momentum built around the Goods and Services Tax regime, which propelled the enabling Constitution Amendment Bill through the Rajya Sabha.
The sense of urgency is amplified by the government’s keenness to roll out GST from April 1, 2017.
“Our aim is to set up the GST Council by September-end or early October so that it can begin working on the fine details of the tax system, including rates, compensation as well as the Model GST legislation,” said sources familiar with the development.
The Council will be set up once the Constitution Amendment Bill is ratified by at least 50 per cent of the States and receives the President’s assent. Indications are that the Empowered Committee of State Finance Ministers, which is charting the GST roadmap, will be converted into the GST Council. It will play a pivotal role in determining other aspects of the tax such as exemptions, threshold, compounding and control.
Revenue Secretary Hasmukh Adhia indicated that the government wants at least 16 States to ratify the Bill in the next 30 days. Prime Minister Narendra Modi and Finance Minister Arun Jaitley are understood to have also sounded out Chief Ministers of BJP-ruled States on the issue.
“BJP-ruled States will either ratify the Bill in the Monsoon Session or call a special session soonest,” said a party leader, adding that discussions are also on with other NDA-ruled States on the issue.
The NDA government has given notice for the amended Bill to be taken up in the Lok Sabha, which is likely next week. The NDA has a majority in the Lok Sabha; in any case, the Congress and other parties too are likely to support the Bill.
Asked about the Congress’ stand in the Lok Sabha, senior party leader Jyotiraditya Scindia told BusinessLine : “The GST concept was introduced by the Congress, but the NDA government frittered away the advantages of GST... Only after two years has it realised the importance of consensus-building and agreed to the changes we demanded.”
“Even now, the upper limit for the tax rates must find form in the GST Bill,” he said. Other parties, including the Left and the Samajwadi Party, will likewise support the Bill in the Lok Sabha. The Centre is looking to bring the AIADMK, the only party to oppose the Bill in the Rajya Sabha, on board.
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