|  |  |  |  |  |  | 

Business Exclusive Headlines India National News

State Finance ministers meet on GST today

New Delhi, Oct 21 (): GST (goods and services tax), the pet project of Finance Minister P Chidambaram moves to the next stage with the Empowered Committee (EC) of State Finance Ministers meet here today to decide on the Union government’s move on the revised constitution amendment bill for goods and services tax.

The meet which was called for next month was fast tracked after Finance Minister dangled the carrot of linking compensation for revenue loss due to cut in central sales tax amounting to Rs 9000 crore to the States if the approval for the bill is given by states.

The finance ministry also wants the EC to fast track the work on the legislation on GST if states have to get Central Sales Tax (CST) compensation. Around Rs 9000 crore has to go to the States as compensation for loss in CST cut for the year 2013-2014.

Chidambaram has told the states they will have to get the Constitution Bill and the GST legislation in fast forward mode to get compensation. GST is a major reform for the industry who having been asking for speedy implantation.

UPA to face elections can implement it within its tenure but the amendment bill has to get through the coming session of Parliament if the EC does not spoil the plan.

Report of a sub-committee of state officials has to go in tandem with the report by Parliament’s standing committee on finance, and the revised draft of the Bill and states’ views on it are the agenda of the EC meet today.

If the EC meets on GST does not propose any major changes, the Centre will table this Bill in the winter session of Parliament. It needs to get two-thirds majority in both the houses and then be ratified by the State legislatures of fifty percent of the total of the states.

The revised draft is broadly in tune with the agreement between the Centre and states in their previous meeting at Bhubaneswar and the suggestions of the standing committee.

The parliamentary panel, headed by Bharatiya Janata Party senior Yashwant Sinha (ex-finance minister), had suggested that a floor and ceiling rate be fixed for GST, decisions in the GST Council should be by voting and not by consensus, and removal of a Disputes Settlement Authority. States view inclusion of fuel and liquor in GST and bringing it in through the entry tax.

These issues need not form part of the constitution amendment bill. The approval of amendments to the constitution is for giving power to the states to tax services and for the Centre to impose tax beyond manufacturing level. The next move is to introduce the legislation, which would spell out the design of GST. Once the constitution amendment is cleared, the Centre will move this bill in Parliament, while states will do so in their respective Assemblies.

state-finance-ministers-meet-on-gst-today

ABOUT THE AUTHOR

POST YOUR COMMENTS

Your email address will not be published. Required fields are marked *

Name *

Email *

Website