" Formally called the Insurance Laws (Amendment) Bill, the measure seeks to replace an ordinance…
NEW DELHI: The Upper House has listed the Goods and Services Bill (GST Bill) for consideration in the Rajya Sabha on Wednesday. Five hours have been set aside in the Parliament to debate what is being touted as the biggest tax reform in the country since Independence.
It has been a long road to here. Ten years to be precise before the major political parties could reach a consensus to allow the Bill to be tabled for consideration.
The GST Bill proposes to do away with the double taxation system in the country for goods and services by subsuming nearly all the indirect taxes and creating what is coined as the ‘one nation, one tax’ system.
First proposed by the Congress Party in 2006, it was tabled after several changes and amendments, in the Lower House or the Lok Sabha in 2015, nine years later.
A severely amended version has reached the Rajya Sabha one year later, with the final set of changes proposed by the Finance Minister, sent out to the Members of Parliament on Tuesday.
On Wednesday, the Bill will be taken up, and even if it gets a nod in before monsoon session of the Parliament is over — it’s what the government is aiming for — there is still a long way to go before the bill will actually be implemented.
The government wants it to be implemented by April 1, 2017, already pushed back from the April 1, 2016 deadline set by FM Arun Jaitley last year.
Here is what happens to the Bill once it is passed in the Rajya Sabha
1) Since the Bill was passed in the Lok Sabha last year, there have been major amendments to it. So it will go back to the Lower House for approval.
2) Once approved by both the houses, the final draft will go to the state assemblies where the government needs atleast 50% of the 29 state assemblies to ratify the Bill before it is accepted.
It looks like this shouldn’t be a problem since 13 states are governed by the BJP.
3) Once the Bill is ratified by the states, it will pave the way for the establishment of a GST council to finalise key things like the GST rate — which is still not finalised and a key debating point — the extent of the indirect taxes that will be subsumed under GST, and so on.
4) The government is aiming at an April 1, 2017 deadline for the rollout of the new taxation system, but according to a Reuters report, experts say that “slippage to July or October 2017 is increasingly likely.”
5) A huge IT system has to be set up, tax collectors and officials have to be trained and companies brought up to speed on a levy that will force businesses to overhaul their systems, a Reuters report said.
(With inputs from agencies)