Parliament passes GST bills; government looking at July 1 rollout

NEW DELHI: Rajya Sabha approved four bills crucial for implementation of the goods and services tax (GST) on Thursday, a move which paves the way for rollout of the ambitious indirect tax reform from July 1.
In a rare show of political consensus, the Congress did not press ahead with amendments and also did not support those moved by other opposition parties such as Trinamool Congress and the Left.
Last week, Lok Sabha had approved the four bills - Central GST bill, Integrated GST bill, Union Territories GST bill and the compensation law. State legislatures will now have to approve the SGST bill (the state goods and services tax). GST has been identified as a top reform priority by the Narendra Modi government and a July 1 rollout is expected to add to the reform credentials of the government. The tax reform will subsume central and state levies such as excise duty, additional duties of customs, service tax, value added tax, central sales tax, entry tax, octroi and luxury tax and is expected to clean up the messy indirect tax structure.
"On May 17-18, we will give final approval to rules and rates, looks like it can be implemented from July 1," finance minister Arun Jaitley said.
The government has indicated that product and service-wise GST rates may be announced closer to the rollout date, while finalising nine sets of rules for the indirect tax reform.
Tax experts said the July 1 rollout seems final.
"The passage of the four bills necessary for introduction of GST by Rajya Sabha reaffirms that July 1 is the go-live date for the most significant indirect tax reform of the country," M S Mani, senior director at consulting firm Deloitte, said.
"The fact that no changes have been suggested by Rajya Sabha signifies the convergence of views between the Centre and the states, making the July introduction of GST a certainty," he said.
The CGST legislation will empower the Centre to levy tax on goods and services once central excise and service tax are subsumed. I-GST is to be levied on inter-state supplies, while S-GST will let the states levy tax after VAT and other levies are subsumed in GST.
GST has been in the pipeline for close to a decade but a consensus had earlier eluded the Centre and the states.
In recent months, there has been substantial progress on rolling out the ambitious tax reform initiative.