Govt unlikely to accede to Cong demand on GST cap: Jaitley

Gaining in confidence following the passage of the Aadhaar Bill, the Centre on Thursday indicated that it was unlikely that it would accept the Congress party’s demand to cap GST rate in the constitution amendment bill.

The landmark legislation, the biggest indirect tax reform since Independence, which seeks to replace a slew of central and state levies with a uniform GST rate to convert the country into a customs union, is pending in the Rajya Sabha as Congress has refused to go with the Bill. The ruling NDA is in minority in Rajya Sabha.

“In the Lok Sabha, the Congress walked out, every other party voted in favour. The Congress party has now made a statement that it has only one issue about the Constitutional cap which is a little difficult because our tariff is not decided through Constitution amendment,” Finance Minister Arun Jaitley said on Thursday. 

Speaking at a media conclave, Jaitley said, “Today, every state government, including all Congress ones, is in favour of Goods and Services Tax (GST). You have every political party in Parliament who will vote in favour.”

After it is approved by Rajya Sabha, the legislation needs to be approved by half of the 29 states so as to  ensure GST roll-out by October 1. 

The Congress, which initially brought the bill, has termed the legislation as flawed and wants the government to cap the GST rate at 18 per cent.

In the scenario of Congress refusing to fall in line, Government has the option to go for a joint sitting of both Houses for the passage of the Bill. Centre’s floor managers so far have restrained themselves from using this option.