The Centre seems to have arrived at a consensus with opposition parties and sources say the Goods and Services Tax (GST) Constitutional Amendment Bill may be tabled on the floor of Parliament Wednesday.
The bill was originally scheduled for being taken up on Tuesday but senior Congress leaders are in UP for a rally. Senior BJP and Congress leaders today met to discuss the GST Bill and sources seperately said the Congress would hold an internal meeting Tuesday.
The GST seeks to replace most central and state level indirect taxes and levies with a single tax.
Sources have told CNBC-TV18 the government
The Centre and states have ironed out most issues that have served as speed-breakers to the ambitious tax reform, sources told CNBC-TV18, adding that in the new bill, the government may move five amendments.
These would include a clause that serves as the “guiding principle” determining how the rate would be calculated, scrapping of the 1 percent additional tax, clarify language for five-year compensation to states (likely remove the words “up to”), strengthening the dispute resolution mechanism, and ensure no revenue loss for states.
It is further learnt that on the contentious subject of dual control of taxing authority, the Centre may lower the minimum threshold.
State finance ministers had recently suggested that states were interested in retaining sole control of taxing powers on small establishments: a suggested threshold of Rs 1.5 crore revenue per annum was doing the rounds.
But sources say that figure may be cut and maximum threshold at which states will have sole taxing powers will be around Rs 75 lakh.
It is also learnt that the total revenue loss to the Centre from GST’s rollout will be about Rs 30,000 crore. This would be compensation of losses that some manufacturing states incur — the GST tax rate may be lower than the current tax rate on many manufactured products. Sources say that a four-tier tax structure is proposed: a standard, concession, deep-concession (for gold products etc) and sin tax (tobacco etc) rate.