FinMin rules out missing GST deadline again

FinMin rules out missing GST deadline again

"Negotiations are still going on. The date of introduction of Goods and Service Tax (GST) has not been changed and we are sticking to the April 1, 2011, deadline," a finance ministry spokesperson told PTI. GST is expected to replace excise duty, service tax on the Centre's end and VAT on the states front, besides local levies, cesses and surcharges.

There have been reports saying the government will miss the April 1 deadline as the Constitution Amendment Bill on GST is unlikely to be tabled in the ongoing Monsoon Session of Parliament as there is no consensus on the issue.

Earlier this week, BJP-ruled states and a few other states opposed a revised draft of the Constitution Amendment Bill on GST and sought one month more to build their views more firmly.

While agreeing to give more time, Finance Minister Pranab Mukherjee had emphasised in his meeting with the state GST panel that introduction of the Bill in the Monsoon Session and discussions between the Centre and states could run parallel.

"The priority for now is the finalisation of the draft Constitution Amendment so that the Amendment Bill may be introduced in Parliament during the ongoing Monsoon Session... It must be appreciated that the Constitution Amendment is only an enabling provision. It does not prohibit us from continuing our dialogue on rates," the Finance Minister had said.

When asked whether the Bill could be introduced in the current session, the spokesperson said he could not say anything in definite terms as negotiations are on. Earlier, state GST panel chief Asim Dasgupta said it is up to the Union Finance Minister to table the Bill in this session or not.

BJP-ruled states had objected to the revised draft of the GST, saying it does not clarify how the changes will be brought about in the GST structure. The earlier draft was rejected by the states on account of the proposed vesting of veto powers with the Union Finance Minister on state taxation issues.

The first draft had proposed setting up a GST Council to take decisions on GST with the consent of the Union Finance Minister and a two-third majority of states. The revised draft, however, said the council could take a decision only when there is a consensus.

However, BJP-ruled states wanted to know the clear meaning of consensus and suggested changing this word with "consent". Both the drafts have also suggested a Dispute Settlement Mechanism.

Mukherjee had said a third revised draft would be prepared to sort out states' concerns. The state finance ministers are likely to meet in early September to sort out the issue.

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