Amit Mitra to use his convincing skills for clearance of GST Bill

Goods and Services  Tax (GST) bill could easily be the most awaited reform which can propel the Indian GDP growth by atleast 1 per cent.  GoI has prepared the ground for clearance of GST and it now seeks stakeholder comments on the draft law which is now ready for discussion in the form of model law for the tax reform.

Amit Mitra, Finance Minister of West Bengal is being tasked to forge consensus among states to help pass the bill. Amit Mitra apparently is also a GST panel head. 

Even as opposition cries foul and makes allegations of some tacit understanding between BJP and TMC, Amit Mitra will have to put his convincing skills to test when he attempts to bring all the stakeholders on common ground and help pass the GST bill, which will help boost the image of the current government as a reformist one.

There are three major issues which need to be ironed out between the NDA and opposition parties, especially Congress viz., 

1. UPA had previously proposed a GST of 16-18 per cent and Modi government had been pressing for higher rate. Now that there may be consensus on 18 per cent, as per media reports the Centre is also willing to reconsider its proposed 1 per cent additional tax. This 1 per cent additional tax was suggested to accommodate fears of manufacturing states like Tamil Nadu (TN), as TN perceived GST roll out to hurt its revenues. Congress and even few tax experts believe this 1 per cent additional tax will defeat the purpose of GST bill.

2. Congress has demanded to put the GST rate in the constitution bill and NDA government in all likelihood is not going to accept this demand and hence have proposed to put the GST rate in the model law.

3. Current GST bill  in its form has deleted the provision that allows creation of Goods and Service Tax Dispute Settlement Authority.  Congress on the other hand has been demanding a judicial panel to resolve the disputes.

The GST bill is expected to replace all the key state & central indirect taxes and levies. The bill needs to be approved via a Constitutional Amendment in both the Parliament as well state assemblies.

GST model law is expected to be discussed in a meet scheduled on June 14 and 15. Several state finance ministers are expected to attend the meeting and Amit Mitra is expected to get the states to agree on the bill.

Finance Minister expects GST roll out from April 1 2017. Actually the GST roll out was expected in April 2016. To avoid further delay in rolling out GST on April 1,2017 the bill will require clearance at least during the monsoon session of Parliament.