The much delayed bill to amend the constitution and introduce a Goods and Services Tax is scheduled to be moved by Finance Minister Arun Jaitley in the Rajya Sabha today.
The bill, technically called the Constitution (One Hundred and Twenty-Second Amendment) Bill, 2014, if passed, will make provision for introduction of Goods and Services Tax in the Constitution.
The Constitution Amendment Bill is aimed at bringing uniform tax regime in the country by subsuming state levies. A single rate of GST will replace central excise, state VAT, entertainment, entry and luxury taxes to ensure seamless transfer of goods and services.
The government is likely to move some amendments to the GST Bill. These include scrapping of the proposed tax of one per cent on inter-State transactions and compensation to the states for any revenue loss in first five years of GST rollout. The new tax will reduce cost of production and make the Indian trade and industry more competitive domestically as well as internationally.
The legislation was approved by the Lok Sabha in May 2015 and tabled in the Rajya Sabha in August last year where it has been stuck due to opposition from the Congress over certain provisions. Government wants to pass the Bill in Parliament through consensus and it has sought support from all the political parties.
The GST Bill was introduced in the Lok Sabha on December 19, 2014, and was passed by the Lok Sabha five months later on May 6. It was then referred to a Select Committee of the Rajya Sabha which submitted its report on July 22. The amendments, if approved today by the Upper House, will need to get the nod of the Lok Sabha again, following which at least 50 per cent of the states need to ratify the bill for it to become a law. This again could be a long-drawn process, since the states will have their own sets of issues and queries.
Yesterday, the government circulated to the MPs the amendments it has proposed in the Bill to enable implementation of the tax. Jaitley told the Rajya Sabha that the amendments to the Bill, pending in the Upper House for the past year, were given to the Secretariat of the House two days ago and have been circulated to the members.
Meanwhile, both the BJP and the Congress have issued a whip to all its MPs in the Rajya Sabha asking them to be present in the House for the next three days.
Yesterday, the government appeared confident of getting the bill passed in the Upper House, where it is in minority, saying it was positive that all parties will support the bill.
“There is a consensus among all parties regarding the importance and requirement for the GST Bill. The Bill is coming after much deliberation and we are positive about the outcome. We are confident all parties will come together to get the bill passed,” Parliamentary Affairs Minister Ananth Kumar said.
Congress MP Abhishek Manu Singhvi said that the party would be in favour of passing the bill if there are no "obstacles".
"If there isn't any obstacle, the GST Bill will be approved tomorrow (Wednesday)," he told reporters outside the Parliament House, but did not elaborate what the "obstacles" could be.
Communist Party of India-Marxist (CPI-M) leader Sitaram Yechury, meanwhile, said the bill that was coming on Wednesday was just to make a provision for introducing GST and they will wait for the GST Bill, while Janata Dal-United leader Sharad Yadav came out in support of the bill.
The Congress originally mooted the GST in 2006 and a constitution amendment bill was introduced in the Lok Sabha in March 2011 but it lapsed with the dissolution of the 15th Lok Sabha.
The present NDA government has termed the GST Bill as the most radical tax reform since Independence.
