With time running out for adopting the goods and services tax (GST), the thorny issue of dual control may end up being put to vote, even though finance minister Arun Jaitley has been citing ‘consensus’ as the way forward for all issues pertaining to the new tax structure.
There has been no consensus on the issue of dual control— whether the centre or the state will have authority on GST assessees — until now. Moreover, the recent demonetisation exercise has derailed what has hitherto been a smooth exercise, sources said.
West Bengal finance minister Amit Mitra, who is the chairman of the empowered committee of state finance ministers on GST, had in fact said in a recent interview that the rollout of the tax reform would have to be deferred as the economy has been disrupted by the demonetisation exercise.
On December 2, the finance minister had said at the Hindustan Times Leadership Summit that there was a constitutional compulsion to roll out the new tax structure before September 2017. “You have a constitutional compulsion to have a GST in place before September 16, 2017. otherwise the country doesn’t run…therefore our intention is that it gets implemented from April 1, 2017,” he had said.
However, it is not clear whether the government will put the issue to vote in the next GST Council meeting slated for December 11 and 12.
The previous meeting of the GST Council, held on December 2 and 3, had remained inconclusive as state finance ministers showed discontentment over demonetisation and sought a discussion on the same. They also escalated matters to seek higher compensation in the wake of the demonetisation.The ongoing session of Parliament is till December 16, and sources said it may be difficult for the government to get Parliament’s approval within this session.
“The issue of dual control seems to be moving towards voting as there is little time left, but putting an issue to vote will also leave a bad taste,” a senior government official, who did not wish to be identified, told HT.
At the recent Petrotech summit, Jaitley said that while most major issues have been sorted out, cross-empowerment is one area that needs to be resolved.
Besides, three GST legislations — CGST, IGST and compensation law — also need to be finalised for these to be introduced in Parliament.