UPA races against time to restart reforms

Desperate to shed the impression of policy stagnation, the UPA government is racing against time to inject momentum in to economic reforms.

Official sources have, for the first time, talked about the possibility of the big ticket tax reform, Goods and Services Tax (GST), getting introduced in the monsoon session of Parliament.

 Renewed hopes of India’s biggest tax reform coming up in the monsoon session has emerged after the standing committee on finance last week decided to finalise its report on GST before the session, expected to start in third week of July.

This also comes close on the heels of the UPA government vowing to push ahead with major transport and power projects in the current financial year with an attempt to inject some life into India’s stuttering economy.

The GST has the potential to add 1.5 to 2 percentage points to country’s gross domestic product and reduce the overall tax burden on goods, which is currently in the range of about 25-30 per cent.

“If the standing committee gives its report on GST well in time before the monsoon session starts, there are all possibilities of the bill getting introduced in the forthcoming session,” a government official told Deccan Herald.

Last week, the standing committee on finance, which met here under the chairmanship of senior BJP leader Yashwant Sinha said that the committee has decided to finalise its report well before the monsoon session so that it is not held responsible for any delay.

Analysts said that the seriousness with which the Opposition is taking the bill gives an impression that it should not miss the April 2013 deadline.