CA Vinod Kaushik
Introduction: Everyone including me is very optimistic about passage of GST Bill in both the houses of Parliament in this undergoing budget session of parliament which has started from 23 February 2015 with the President speech and will conclude on 08th May 2015.It is worth to mention the extracts of President speech that “While my Government has intensified efforts to bring greater efficiency and equity into the tax system, prudence in expenditure management is also high on the agenda of my Government. A Constitutional (Amendment) Bill has been introduced to bring in Goods and Services Tax that will simplify the indirect tax regime, broaden the tax base and result in better tax compliance.” The president speech duly incorporates the intention of Government to bring GST law from 01-04-2016.
Agenda of Budget Session 2015:
As per PRS research India the 122nd Constitution Amendment (GST) Bill 2014 is listed for consideration and passing in both the houses of Parliament as on date. The Govt. has promulgated too many ordinances which are waiting to become law in this session of parliament such as Coal auction Bill, Insurance bill and most disputed Land acquisition bill. The number game is very crucial for passage of GST bill since as per Constitution 2/3 majority is required for passage of this long awaited GST bill. Looking at the efforts of this Govt. particularly of Mr. Jaitley who is working very hard from the day he took charge as a FM to bring all the state on board, till date most of the states agreed to the current model of GST. We can expect the discussion on GST bill in this session and its passage in both the Houses if all is goes well.
Hurdles in the way of GST in this Budget session:
On papers most of the States agree on current model of GST as the same incorporates the changes as desired by them but some States has doubt on the promises made on compensation by the Central Government. But it is unlikely that Central Govt. will do so since they have recently increased the share of States in Centre Pool by 10%.The devolution to the States would be of the order of 5.24 lakh crore in 2015-16 as against the devolution of 3.38 lakh crore as per revised estimates of 2014-15.This again goes in favor of current Govt. as compared to the previous UPA Govt. which was adamant on release of constitutional share of states. The only hurdle that remains as of now is “TYRANNY OF OPPOSITION” which may cause delay in passage of this most awaited bill in this current session of Parliament.
Discussion of GST in Budget speech:
For the knowledge of my readers I would like to tell that the FM has referred GST in his budget speech so many times which hints at the intention of ruling govt. to bring this biggest Indirect Tax reforms by 01-04-2016. Some of them have been shared with you which are as follows:
- We are now embarked on two more game changing reforms GST and what the Economic Survey has called the JAM Trinity – Jan Dhan, Aadhar and Mobile – to implement direct transfer of benefits. GST will put in place a state-of-the-art indirect tax system by 1st April, 2016-Arun Jaitley
- We also have to take into account the drastically reduced fiscal space; uncertainties that implementation of GST will create; and the likely burden from the report of the 7th Pay Commission. Rushing into, or insisting on, a pre-set time-table for fiscal consolidation pro-cyclically would, in my opinion, not be pro-growth- Arun Jaitley
- We need an enabling tax policy for this. I have already introduced the Bill to amend the Constitution of India for Goods and Services Tax (GST) in the last Session of this august House. GST is expected to play a transformative role in the way our economy functions. It will add buoyancy to our economy by developing a common Indian market and reducing the cascading effect on the cost of goods and services. We are moving in various fronts to implement GST from the next year-Arun Jaitley
Alignment of Current taxes with GST:
As part of the movement towards GST, I propose to subsume the Education Cess and the Secondary and Higher Education Cess in Central Excise duty. In effect, the general rate of Central Excise Duty of 12.36% including the cesses is being rounded off to 12.5%. Introduction of GST is eagerly awaited by Trade and Industry to facilitate a smooth transition to levy of tax on services by both the Centre and the States, it is proposed to increase the present rate of service tax plus education cesses from 12.36% to a consolidated rate of 14%.
Concluding remarks:
No matter what kind of differences the opposition may have with ruling party but we the common citizens are funding the cost of each session of both the Houses which is not a small amount hence we expect seasoned opposition to help Govt. to bring this long awaited tax reform called GST by 01-04-2016.I hope the “TYRANNY OF OPPOSITION” will end this time in Rajya Sabha otherwise the option of joint session is always with the Govt.
(Author can be reached at cavinodkumar67@gmail.com, +91-9953236278)
Author Bio
All the Elected Representatives should come forward to attend assemblies and Parliament sessions without any adjournments. Like Govt. Employees they should work on continuos basis then only all pending matters can be cleared / bills passed within the specified time.