Hinting at the rollout of GST next year, Finance Minister Arun Jaitley on Thursday said a constitution amendment bill on the new indirect tax regime will be brought to Rajya Sabha in the next session and all supporting legislations required will be in place by the year end.

COMMERCIAL BREAK
SCROLL TO CONTINUE READING

"I intend bringing up the Constitution Amendment Bill for consideration in the Upper House in the very next session of Parliament which starts next month and I am reasonably hopeful of this being passed," he said.

Speaking at an 'India: Investment Promotion Seminar' organised by Confederation of Indian Industry (CII) and Department of Industrial Policy and Promotion (DIPP), Jaitley said the numbers in Rajya Sabha are "overwhelmingly in favour of GST".

The Goods and Services Tax (GST) Bill -- which creates a single national sales tax to replace several state and central levies -- has already been approved by the Lok Sabha or Lower House of Parliament and is pending in the Upper House where the government doesn't have a majority.

"After the Constitution Amendment is approved, there are three legislations that are required to be passed, two by the central government and one by state assemblies. Now, on the assumption that the GST will be passed in (the ensuing) monsoon session of Parliament, then by the end of the year those draft legislations are ready and GST council has to approve it," he said.

After Parliament approves the constitutional amendment to allow GST, the measure needs to be ratified by more than half of states. Then Parliament must pass another bill to implement the Goods and Services Tax (GST).

The overall rate, which would vary for different goods, would be set by a newly formed GST Council.

Jaitley, who arrived in Osaka in Japan on Wednesday on the second leg of his six-day investor wooing tour of Japan, said the IT backbone required for enforcement of GST has made significant headway.

"Under the GST Bill, the rate of tax is to be decided by GST Council. The Council comprises of State and Central government," he said.

GST, he said, will help in checking tax evasion.

"I think in the long run, GST rates will moderate further. At what rate, the GST Council will start it, I don't know... there have been recommendations which have been made by expert committees including the one that ministry of finance had set up. I'm sure we will try to keep rates as moderate as possible," he said.

On Wednesday, Jaitley had said he hoped the main opposition Congress will come on board to help in the passage of the India's biggest indirect tax reform bill since the Independence.

The main opposition party wants the GST rate capped at 18%, the proposed 1% additional levy on inter-state trade be removed and an independent dispute resolution mechanism for states.