For July 1 Rollout, Finance Minister Moves Crucial GST Bills Today

For July 1 Rollout, Finance Minister Moves Crucial GST Bills Today

GST Bills – Finance Minister Arun Jaitley has this morning presented for Parliament’s approval four supporting bills that will allow the government to meet its July deadline to implement the mega reform Goods and Services Tax. The four legislation and related changes in existing laws have been introduced in the Lok Sabha or lower house first. The government wants the house to debate and pass the bills latest by Thursday this week. It will then present them in the Rajya Sabha.

Here is your 10-point guide to this story

1. The bills – Central GST, Integrated GST, Union Territories GST and the compensation law – were approved by the cabinet earlier this month. Once these get Parliament’s approval, a state GST bill will be presented in state assemblies.

2. The Cabinet approval came after the powerful GST Council, headed by Union Finance Minister Arun Jaitley and featuring state finance ministers as members, cleared the five draft laws, ironing out the remaining differences between the states and the Centre on how to implement the national tax that will replace a slew of indirect taxes.

3. The BJP-led government is hurrying through with the presentation of the bills in the Lok Sabha, where it has a commanding majority, as it wants enough time to move them in the Rajya Sabha and bring back to the Lok Sabha any amendment suggested by the Upper House.

4. These GST bills are all money bills, which means that the Rajya Sabha’s suggestions are not binding on the Lok Sabha. It can choose to accept or reject them. The government however wants a full debate in the Rajya Sabha to stave off criticism by the opposition that it is trying to circumvent the upper house, where it is in a minority.

5. All this has to be done before April 12, when the Budget session of Parliament ends. GST has already missed an earlier deadline of April 1 for roll-out.

6. There will be four tax slabs of 5, 12, 18 and 28 per cent, plus a levy on taxes on items like cars, aerated drinks and tobacco products to compensate states for any revenue losses in the first five years.

7. The compensation law has been prepared to give legislative backing to the Centre’s promise to compensate the states for 5 years for any revenue loss from the implementation of GST.

8. Since GST will subsume indirect taxes levied by both the centre and states, the Central GST or CGST and State GST or SGST Bills lay out how the new tax will be shared between the two. The SGST will include state-specific exemptions.

9. The integrated GST (I-GST) deals with taxation on inter-state movement of goods and services. The Union Territory GST (UT-GST) Bill covers taxation in Union Territories.

10. GST, the biggest tax reform since Independence, is expected to boost the rate of economic growth by about 0.5 percentage points, broaden the revenue base and cut compliance cost for firms.

Source:NDTV