Govt gets Oppn support for GST Bill

Govt gets Oppn support for GST Bill

The Centre on Tuesday managed to garner support from the Opposition, barring the AIADMK, for passing the long-pending Goods and Services Tax (GST) Bill.

However, concerns remained on the rate of taxation and compensation issue.
Several parties, including the Congress, were also adamant on sending the bill to a Standing Committee despite Finance Minister Arun Jaitley requesting them not to do so.

“I beseech you, clear the GST Bill,” Jaitley told the Lok Sabha, urging the Opposition not to send it to a Standing Committee as it would only delay it.

“This bill has gone through the Standing Committee for two-and-a-half years, dozens and dozens of meetings of empowered committees... Only then has a consensus emerged. I beseech you to rise above party considerations,” said Jaitley.

The Congress was quick to extend its support with senior leader Veerappa Moily saying, “I rise to support the bill”, while initiating the discussion. Jaitley thanked him immediately.

Parties such as the Biju Janata Dal (BJD) and Communist Party of India-Marxist also supported the bill. The Trinamool Congress, too, “broadly” supported the bill. But unfazed by Jaitley’s request, most parties demanded that the bill be sent to a Standing Committee. The Congress and BJD were prominent ones to make this demand.

Reservations also remained on the high rate of taxation (27 per cent) and on compensation.
The BJD, YSR Congress and the Nationalist Congress Party wanted the taxation rate to be on a par with European countries (13 per cent).

On the compensation issue, Maharashtra said it was going to lose Rs 14,000 crore of octroi revenue per year and sought the finance minister to compensate for the loss.

Punjab, too, demanded compensation on account of purchase tax on food grain which the state is going to forgo after the GST regime is in place.

States cutting across party lines also demanded the compensation period to be raised from 5 years to 10 years.

States with manufacturing hubs such as Gujarat, Maharashtra and Tamil Nadu, are facing problems since the GST will be levied on buyers of goods and services or where the service is consumed.

To compensate for this, such states will be allowed 1 per centage point extra tax on goods for at least two years.

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