Economy

Govt fears missing GST deadline

SHISHIR SINHA New Delhi | Updated on January 23, 2018

Minister of State for Finance Jayant Sinha (file photo)

With just four sittings left for the Monsoon Session of Parliament, which will end on August 13, the chances of the Constitution Amendment Bill for the Goods & Services Tax (GST) being passed are looking bleak. 

“India is at the risk of missing the deadline for GST if the Constitution Amendment Bill does not get passed in the Monsoon session,” Minister of State for Finance Jayant Sinha told BusinessLine here on Friday. The government plans to introduce GST from April 1 next year.

Sinha said the government is pushing hard to get the Bill passed and will continue to do so during the remainder of the session. However, Congress, the principal Opposition, is not willing to rethink its stand, with a senior party leader blaming the government for the impasse. 

The problem is that the Constitution Amendment Bill cannot be passed in the din. It needs order in the House, after which it will require a yes from at least two-thirds of the members ‘present and voting’.

Since the Select Panel of the Rajya Sabha has given its report, the revised Bill will first need to be passed in the Upper House. But, the problem is that the government is in a minority in the Rajya Sabha, which is why the situation is becoming difficult.

Considering the Opposition’s stance, the government is yet to put the Bill in the list of business for next week, which effectively means it will be taken up during the Winter session.

Although, there is talk about taking the ‘Money Bill’ route to get the legislation passed without the Rajya Sabha, a Constitution Amendment Bill cannot be categorised as a Money Bill.

Also, there cannot be a joint session for such a Bill as Article 368 of the Constitution requires each House to pass the Bill by the prescribed special majority. So, the Bill can only be taken up when the House is in order.

Once, both Houses approve the Bill, it will need a nod from at least half of the State Assemblies, after which the President will give his assent. After that, three legislations, one for CGST, one for SGST and one for IGST, need to be enacted. Only then will the new indirect tax reform be implemented.

Meanwhile, in an answer laid on the table of the House on Friday, Finance Minister Arun Jaitley reiterated the government’s intention to implement the new indirect tax reforms from next year.

According to him, the Centre has assured the States through the mechanism of the Empowered Committee of the State Finance Ministers that they will be provided compensation for the loss of revenue arising on account of implementation of the GST, for five years.

He also stated that the GST rate would be recommended by the GST Council and that it would come into existence after the Constitution Amendment is passed by Parliament.

Published on August 07, 2015

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