Rajya Sabha today started discussion on four supplementary bills to implement a common goods and services tax across the country. Finance Minister Arun Jaitley is expected to respond to the members’ queries on Thursday afternoon.
These bills are The Central Goods and Services Tax Bill, 2017, The Integrated Goods and Services Tax Bill, 2017, The Goods and Services Tax (Compensation to States) Bill, 2017 amd The Union Territory Goods and Services Tax Bill, 2017
Starting the debate, Congress’ deputy leader in the Rajya Sabha Anand Sharma alleged that the GST was delayed by BJP when it was in opposition due to partisan reasons. Sharma also alleged that the Rajya Sabha was deliberately not involved in the passing these GST related bills as they were brought by the government as Money Bills.
Sharma also sought to know from the finance minister about the tax exemptions given to Special Economic Zones, exemptions given by state governments and other such exemptions.
He said the purpose of GST was to have a ‘simple, effective and transparent’ tax regime but he had his doubts as there were multiple tax slabs and these slabs don’t make the GST an ideal GST.
Responding to Anand Sharma’s accusation of ruling bloc bypassing the Rajya Sabha by bringing the GST related bills as money bills, BJP member from Rajasthan Bhupendra Yadav said that the framers of Indian constitution gave the power to decide financial matters to directly elected house.
Bhupendra Yadav said that coming together of all 29 states to formulate and approve these bills at GST council was the biggest proof of India’s nationalism.
Yadav also said that implementation of GST would lead to reduction in corruption and black money.
Derek O’ Brien, AITC member from West Bengal, also referred to the stalling of GST by BJP chief ministers when it was in opposition at Centre in 2012.
Taking forward the debate, independent member from Karnataka, Rajiv Chandrasekhar said GST was a consumer and business friendly tax regime as it relies heavily on technology and would help in ending the Inspector Raj that was hated by Industry and businesses.
He said, “Entire rational of GST is that it’s pro consumer and business friendly.”
Saying that GST was vital and important part of transforming India, Rajiv Chandrashekhar also urged the finance minister to apply 20% slab on least number of goods as the government did not want itself to be categorised as a high tax society and make a smooth transition from old tax regime to a new one.
TKS Elangovan, DMK member from Tamil Nadu said that with the implementation of GST the powers of states to levy taxes would be reduced and they would be reduced to the level of municipalities.
Elangovan said, “India is a union of states. One major power that has been taken away from the states is to levy tax. The ‘New India’ that we are going to see is being a dangerous thing if the power to levy tax is being taken away from states.”
Elangovan said if the Prime Minister pursues his vision of New India then it would be a dangerous India.
Referring to a statement by Finance Minister Jailty that the of GST would not lead to price rise, Elangovan said that implementation of GST indeed led to inflation in Singapore.
He also urged the government not to impose tax on potable water.
Congress member from Madhya Pradesh, Digvijay Singh said his party historically supported the GST Bill and even today it would support the bills.
Criticising the ruling party BJP for first opposing the GST and then implementing it Digvijay said, “BJP has a history of U-turns and then trying to take credit for it.”
Digvijay alleged that the Prime Minister Modi had always opposed the idea of GST before winning 2014 general election. He said if the BJP had supported it in 2007 then India’s GDP would have benefitted by almost 12 lakh crore rupees.
Digvijay Singh expressed concerns over devolution of taxes to local bodies and rural local bodies. Singh said that the transfer of taxes does not take place at the local level.
Digvijay also expressed the concern over the requirement to file three tax returns every month and urged the government to create awareness about the new tax system.
He also asked the government to reduce the number of exemptions.
Digvijay also expressed concerns over the penal provisions in bill that also entail imprisonment for tax evasion.
Digvijay also warned the ruling BJP party that a complex GST may alieneate BJP’s traditional support base of small traders and shop keepers.
Participating in the debate, BJP member from Maharashtra, Ajay Sancheti said it would be a golden moment for the country when GST would be implemented.
He said: “It’s a big step in the direction of – one country, one tax regime.”
Sancheti said the varying tax rates in different states would be done away with in the new tax regime.
Sancheti also discounted the apprehension of ‘tax terrorism’ as expressed by some opposition members saying that it’s a transparent tax regime that does not leave much powers in the hands of tax administrators.
Congress member from Karnataka Jairam Ramesh said his party would follow its duties in the Rajya Sabha by supporting the GST related bills.
Ramesh said that the idea of GST came into being during the time of tenure of Prime Minister VP Singh as MODVAT or Modified VAT – and then it was taken forward by successive Prime Ministers like Rajiv Gandhi, Atal Bihari Bajpai, Manmohan Singh and a common goods and services tax known as GST is actually getting implemented when Narendra Modi is Prime Minister.
Ramesh said the successive Prime Ministers deserved as much credit as the current Prime Minister.
In a veiled reference to Prime Minister Narendra Modi’s opposition to the GST when he was chief minister of Gujarat, Jairam Ramesh said Finance Minister Arun Jaitley did have two advantages that neither of this two predecessors Pranab Mukherjee and P Chidambaram did not have.
Elaborating on his veiled reference Ramesh said, “Jaitley did not have to deal with a cussed standing committee and a single minded obstructionist chief minister.”
However, Jairam Ramesh relented and agreed to use the word ‘un-cooperative’ in stead of ‘obstructionist’ for Prime Minister Narendra Modi when he was Gujarat Chief Minister when BJP member Bhupendra Yadav objected to the use of the term calling it ‘un-parliamentary’.
Congress has always maintained that GST was stalled by Mr Narendra Modi when he was Chief Minister of Gujarat.