Congress, government say ready for GST discussion

Finance ministry rules out adding GST rate in Bill

The government and the main opposition, the Congress, on Wednesday were on the same page on the crucial goods and services tax (GST) Bill as far as talks were concerned. On the eve of the winter session of Parliament, Finance Minister Arun Jaitley assured the Congress it would hold consultations with opposition parties over the crucial GST Bill. The Congress told the government it had made its main concerns clear and wanted the government to respond to those, implying it was open to negotiations.

Addressing reporters after an all- party meeting, Leader of the Opposition in the Rajya Sabha Ghulam Nabi Azad said, “The government has never discussed with us on the GST. We have made clear our concerns and it is now for the government to get back to us. We are open for discussion.” The view was also reiterated by party Vice- President Rahul Gandhi in Bengaluru. “ We strongly believe in GST ... but the government’s approach has to be one of reaching out to the Opposition.” The Congress had asked for capping the GST rate at 18 per cent, doing away with an one per cent additional tax and setting up of a dispute redressal authority.

Describing Congress’ concerns as “ legitimate”, Azad said, “We want a GST tax that is not just pro- industry but pro- trade and pro- consumer as well.” “Even in the last session ( monsoon) we had asked for a discussion but the government did not hear us.” As the finance minister was quoted in the media as saying that the Congress’ demands were “ preposterous”, Azad asked the FM for a clarification. Jaitley assured him that the government would discuss and consult with them.

Prime Minister Narendra Modi, who made a brief appearance at the all- party meeting, made a strong pitch for an early passage of the GST Bill, saying it would be in the interest of the nation.

In a related development, finance ministry sources on Wednesday ruled out incorporating GST rates in the Constitution amendment Bill, which was one of the demands of the Congress. Jaitley had on Tuesday called this demand “preposterous”.“Putting the rates in the Constitution amendment Bill is out of the question. GST rates will be dynamic and cannot be static. The rates will be change year to year. Within a year also it may change twice,” a finance ministry official said. Each time you change the rates, you have to go back and amend the Constitution, the official added. “Let me tell you this was not even part of the draft Bill that was approved by Mr ( P) Chidambaram. It is the first time this has come up.” Congress sources said the party was willing to compromise if the government responded with some structured constructive feedback on their demands. For instance, the party would be open for negotiations on the 18 per cent cap on GST, after deliberating on the government’s response.

JD( U), BJD to back Bill

The JD( U) and the BJD said on Wednesday they would support the Bill. The Trinamool Congress (TMC), which otherwise supports the GST “ in principle”, has said a high 27 per cent rate would lead to leakages and compliance issues. West Bengal Finance minister Amit Mitra told reporters here on Wednesday, “ For 26 or 27 per cent rate of GST, there will be lot of leakages. If the revenueneutral rate is too high, there will be leakages, there will be lower compliance.”

Business Standrad, New Delhi, 26th Nov. 2015

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