Govt scrambles to pass GST-linked bills but chances bleak

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The government is racing against time to pass bills linked to the goods and services tax (GST), with just three working days before this protest-marred winter session of Parliament concludes.

The session has been almost a washout thus far because of the Opposition’s a belligerent stand against the government’s surprise move to demonetise the economy, scrapping 500- and 1,000-rupee banknotes that together formed 86% of the cash in circulation.

The three bills — the central goods and service tax (CGST), integrated goods and service tax (IGST), and a compensation legislation — has to be passed this session for the government to meet its target of implementing the country’s largest indirect tax overhaul for a uniform market from next April.

The government could sidestep a number of other legislation lined up for this session to focus solely on those related to the GST in the remaining days.

But the Opposition will loathe letting the demonetisation challenge off the hook.

“Where is the time for the GST? Where is the political climate for the GST? Chances to pass the bill are gone,” said senior Congress leader Jairam Ramesh, a member of the party’s panel to review bills.

The Trinamool Congress, which supported the GST before, has reversed its stand after Prime Minister Narendra Modi announced the demonetisation drive on November 8.

“It was improper for the government not to allow a debate in Parliament on demonetisation. The situation has further vitiated. We are not talking about GST anymore,” Trinamool’s leader Sudip Bandopadhyay said.

The Opposition wants a debate in Parliament in which Modi must speak on his demonetisation decision.

Besides an unwilling Opposition, there are other unresolved issues pertaining to the new tax regime for a single, nationwide market that will do away with most of the subsidiary taxes on goods.The Centre could take the risk of taking the extreme step of pushing these bills without debate in the Lok Sabha, despite the Opposition disrupting proceedings over the demonetisation standoff, sources said.

Even after five meetings, the Centre and states have yet to hammer out the share of administrative power on the 10-million indirect tax assessees.

The CGST legislation deals with tax imposed and collected by the Centre. The IGST is for interstate movement of goods and services and their taxation. The third bill will tackle the compensation that the Centre will give to the states for loss of revenue under the indirect tax regime.

The Rajya Sabha, where the Modi’s government doesn’t have the numbers to push through key legislation, passed the 122nd Constitution amendment bill this April, paving the way for implementing the GST.

The Opposition hoped the government will bring secondary legislation linked to the GST as financial bill in the Rajya Sabha, not as money bills which cannot be voted in the Upper House. There are fears the government will bypass the Rajya Sabha by introducing subordinate legislation as money bills.

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