GST Bill expected to sail through in Lok Sabha today
The Good and Service Tax (GST), is all set to cross the next hurdle as the Lok Sabha would take it up discussion on Monday. With the ruling BJP having majority in the lower house, the GST Bill, which would herald the biggest economic reform since 1991, is likely to sail through smoothly.
It will replace a raft of different state and local taxes with a single unified value added tax system to turn the country into world’s biggest single market. Prime Minister Narendra Modi is likely to intervene during the debate on the Bill in Lok Sabha.
The Bill had been passed by the Lok Sabha last year but was ratified by the Rajya Sabha only after principal Opposition Congress managed to pushed many amendments to the original draft. The government is in a minority in the Rajya Sabha and GST Bill being a constitutional amendment bill needed the presence of two-thirds of the members present and voting.
However, after having crossed the Rajya Sabha hurdle, the chances of the Bill facing any impediment in the Lok Sabha appears remote. Congress leader Jyotiraditya Scindia on Sunday said the party will support GST Constitutional Amendment Bill and has issued whip to all its MPs to be present in the House on Monday where it is scheduled to be taken up for passage.
Aiming for early implementation of the Goods and Services Tax (GST), senior Union ministers have spoken to chief ministers of NDA-ruled states to ensure that the constitutional amendment is ratified by state assemblies at the earliest.
The chief ministers have assured that, if required, they will call a special session for the passage of the Bill in their state assemblies. The GST Bill has to be ratified by at least 16 states in 30 days after it is passed by Parliament.
Once implemented, GST will subsume various taxes, including excise, services tax, octroi and other levies, and the proceeds will be shared between the Centre and the states. Under the new GST regime goods would be taxed at the point of consumption, instead of the goods being taxed multiple times at different rates.
The GST, which was first proposed a decade back, is seen as potentially transformative for India’s economy, adding as much as 2 percentage points to the GDP while also improving the ease of doing business and encourage investment in manufacturing. It is also expected to result in greater tax compliance, boosting government revenues.