Parliament has passed the passed Goods and Services Tax Bills with the Rajya Sabha considering and returning to the Lok Sabha. Before returing the bills, it rejected all the amendments moved by the TMC and CPI(M). The Bills are Central GST, Integrated GST, Union Territory GST and GST Compensation.
The Central GST deals with taxation related to Centre, integrated GST deals in taxation of inter-state movement of goods and services while the Union Territory GST Bill covers taxation in Union Territories.
The compensation law has been prepared to give a legislative backing to the Centre’s promise to compensate the states for five years for any revenue loss arising out of GST implementation.
Replying to debate, Finance Minister Arun Jaitley assured the Rajya Sabha that agricultural produce will not be taxed under the new indirect tax regime. He said, all those items which are exempted as of now will continue to be exempted.
Mr Jaitley said, under the present system, there is a federal arrangement which no party can unilaterally alter. On GST network, Mr. Jaitley said the data is fully secured with an IT firewall. He said, besides making any information public, will have penal consequences. He said, with the passage of the new law, free flow of goods and services will take place and the country as a whole will benefit.
Mr Jaitley said once the new regime is implemented, the harassment of businesses by different authorities will end and India will be have one rate for one commodity throughout the country. He further said with implementation of the GST, revenue of Centre, states and industry and trade must benefit. Mr Jaitley said, cess imposed on luxury and demerit goods will be utilised to compensate the states for revenue loss in the first five years of GST implementation and later they will be subsumed in GST rates.
Mr. Jaitley said, out of nine set of rules which are to be made for implementation of GST, five set of rules have been finalised and four others have been approved tentatively. He said, the work on fixing rates has started and GST council will take final decision next month.
The Minister said, the country started on the idea of a GST law in 2006, it looked very difficult but today it is a reality and collective property of the nation.Mr Jaitley said successive governments have contributed towards the GST and no one person can take credit for it. He also informed that Jammu and Kashmir government has agreed to bring a legislation in its assembly to get its extension to that State.
Earlier, participating in the discussions, Congress leader Kapil Sibal said, the GST is not an ideal law. Mr Sibal said the bill excludes tobacco, petrol, turbine and real estate from its list. He asked the government how it can maintain secure data. He said the GST is anti-MSME, industry, agriculture.
Resuming the discussion, Surendra Singh Nagar of the Samajwadi Party wanted to know from the government what measures are being thought of in case inflation goes up and down as it has happened in some of the countries which introduced the GST concept. He said the government will face a big challenge due to GST effect on Foreign Direct Investments (FDI).
Mr Nagar said the government should ensure that the small businessmen in the country should not face any kind of problems. Satish Chandra Mishra of the BSP described GST as historic bill and said his party is supporting it. He suggested that people should also be acclimatized about the concept.
He said the small businessmen who commit offences in their business dealings should be given relaxation in the first year of the GST implementation. Sharad Yadav of JD(U) asked the government to make the system simple. Praful Patel of the NCP wanted tobacco, petrol and electricity should be added to the list of GST.
Later talking to reporters outside Parliament, Mr Jaitley said, Parliament has passed all the four bills related to GST unanimously. He said, it is a matter of happiness that all political parties extended their support in the passage of the bills. He said, after the President’s assent to the bills, they will become the Law. Mr Jaitley said, now the States can pass the State GST Bill in their assemblies.