JOIN USThe Goods and Services Tax (GST) Bill moved a step closer to implementation, with half of the state Assemblies ratifying the Constitutional amendment before the deadline.
Now, the bill is set for presidential assent, after which a GST Council will be constituted to set up tax rates under the new and revamped indirect tax law.
Odisha became the 16th state to ratify the bill earlier in the day. The government had allotted 30 days for securing approval of states and the deadline was set to expire on September 6.
After the Odisha Assembly approved the Constitutional amendment, Union Finance Minister Arun Jaitley took to twitter, saying the bill had got the requisite numbers. “The requisite number of states have ratified the GST Constitution Amendment Bill and now it can go for presidential assent,” Jaitley tweeted.
At least 16 states were required to ratify the Constitution (122nd Amendment) Bill, 2014, or the GST, which was passed by Parliament last month. The government has set a target to roll-out the GST Act on April 1, 2017. Once implemented, India’s biggest indirect tax reform since Independence, the GST will subsume 11 types of Central and state levies into one indirect tax.
After the president’s approval, the Centre will move on to draft the Central GST (CGST) and Integrated GST (IGST) laws and the states will frame the SGST rules, which are expected to be tabled in Parliament in November.
Before that, all 29 states will have to agree on a standard GST rate, an exemption list or a list of goods and services that will be out of the GST and tax slabs. But the final tax rate will be decided by the GST Council.
Industry bodies have also given their input on the GST rate to the empowered committee of state finance ministers. They have lobbied for 18%. The government on its part has said the rates should be such that it does not hit the common man.
Allaying fears that the GST will set in high inflation in the economy, Chief Economic Advisor Arvind Subramanian said that more than 55% of goods consumed by masses have been kept out of the GST.
E-commerce companies and a few others have urged the government to keep them out of the GST, but the government has not given any commitment yet. About goods being outside the GST, the government said the exemption list will be very short to give full benefit of the new tax regime to the public.