Thursday, October 21, 2021

Government has few options for passage of GST bill

The GST cannot be implemented without a constitutional amendment as the states do not have the power to impose service tax while the Centre can't levy tax on goods beyond factory gate.

Written by Liz Mathew | New Delhi |
August 14, 2015 3:43:17 pm
GST bill, passage of GST bill, Arun Jaitley, GST bill LS passage, Narendra Modi, Goods and Services Tax Bill, BJP government, Narendra Modi government, indian express explained, ie explained Union Finance Minister Arun Jaitley. (PTI Photo)

Union Finance Minister Arun Jaitley has said that the government will “use every alternative mechanism to pass it.” According to Jaitley since the central government is firm in its intent to pass the GST bill, all political and constitutional options are open.

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In fact, the government has few options for the passage of the Constitution (122 Amendment) Bill, 2014 which would pave the way for one of the key reform bills before the Prime Minister Narendra Modi government – the  Goods and Services Tax (GST) Bill. All constitutional amendment bills have to be introduced in either house of Parliament and then have to be passed by each house with a majority of not less than two-thirds of the members of that house present and voting.

“There is no other way to pass a constitutional amendment bill. Unlike other bills, there is no provision for bringing a constitutional amendment through an ordinance or a joint sitting of the house,’’ said Constitution expert, Subhash Kashyap.

The GST cannot be implemented without a constitutional amendment as the states do not have the power to impose service tax while the Centre can’t levy tax on goods beyond factory gate. While the Value Added Tax (VAT), another milestone in the tax regime, could be state-specific, GST is structured in such a way that all states have to join in for unified tax network.

The task before the government to pass the 122 nd amendment is to find adequate numbers in both houses. The decision of the Cabinet Committee on Parliamentary Affairs (CCPA) to prorogue the session immediately is one option the government is exploring.  If the political leadership finds a way out to buy peace with the opposition parties, a special session can be convened only to pass the GST so that its new tax regime can be rolled out from April 1, 2016, the current deadline.

The Lok Sabha would not be hurdle for the BJP as it has majority. If the government manages to rope in enough numbers to meet the criteria, the Rajya Sabha can take up the bill with the amendments suggested by the Select Committee. In the Rajya Sabha, where the Congress has a strength of 68 members, the BJP 44 and the NDA 63, the government requires the support of at least 163 members to pass a constitutional amendment bill.

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