Narendra Modi could have his Rajnikanth moment next week by winning a vote in favour of the Goods and Services tax (GST) in the Rajya Sabha, nearly a decade after it was introduced.
GST could soon be a reality owing to the open support of a majority in the 243-member Rajya Sabha. PM Modi is determined to build a consensus over the passage of the GST bill in the current monsoon session of the Parliament and wants to leave no stone unturned to bring the reform.
Finance Ministry sources reveal a cabinet note to remove one per cent additional tax in the draft GST Bill is ready and will be taken up shortly.
The one per cent tax on interstate movement of goods has been a sticky point in the GST Bill with the main Opposition party Congress demanding it to be dropped to avoid distortions.
Sources told Reuters that the amendment to drop the one per cent additional tax in GST may be taken up by the Cabinet next week.
GST, a single taxation system, is being pitched by the Modi government to eliminate the conflict between goods and services and make India corruption-free. Experts believe it will also boost country’s gross domestic product.
The government is said to have discussed proposals to reconcile Congress’s demands for a tax cap of 18 per cent, abolition of one per cent surcharge and creation of a dispute redressal mechanism other than the proposed GST council.
BJP leaders such as Finance Minister Arun Jaitley have held several rounds of formal and informal discussions with Congress leaders and the exchanges are now focussing on resolving the nitty-gritties of the legislation.
The BJP is optimistic that since GST was originally a UPA Bill, Congress would not want to be seen opposing it when it is put to vote. However, BJP leaders are wary of support from Sonia or Rahul Gandhi on the day of passage of the Bill.
Majority of the regional parties including Trinamool Congress, Biju Janata Dal and Samajwadi Party have expressed their support towards the bill. Earlier this week, the government also won the support of Janata Dal United’s Nitish Kumar leaving AIADMK’s J Jayalalithaa alone in opposition of the GST among the regional parties.
The support of Bahujan Samaj Party (BSP) supremo Mayawati now hangs in balance post BJP leader Dayashankar Singh’s derogatory remarks, which have led to massive protests by party supporters throughout the country.
BJP is likely to get the backing of majority parties in the Rajya Sabha, barring 60 votes of the Congress and a total of 19 votes from the AIADMK and BSP along with ambiguity of a yes vote from the 9 members of the Left.
The proposal for a constitutional amendment to enable the GST has been cleared by the Lok Sabha but is stalled in the Rajya Sabha.