The Narendra Modi-led NDA government plans to introduce the Goods and Services Tax this year itself, and is set to get the process rolling during the Monsoon Session of Parliament.
For this, finance minister Arun Jaitley has sought a separate session with his officials on the status and contentious issues regarding its implementation on Thursday.
The decision comes after the revenue department briefed the minister about pending issues. Similar presentations were also held with the department of disinvestment that has called for moving forward with the residual stake sale in Hindustan Zinc and Balco as well as issues concerning loss-making public sector firms.
A source told The Indian Express that the new government is likely to push for introduction of the Constitution (115th Amendment) Bill, 2011, “by the Monsoon Session while the Budget 2014-15 may see an announcement regarding the GST introduction”. The amendment is necessary for the introduction of the new indirect tax regime as it will provide the states the power tax services while also allow the Centre to tax a product beyond the factory gate.
For the Bill to get passed, the government needs two-thirds majority in both the Lok Sabha and the Rajya Sabha while 50 per cent of states have to ratify it. “After the presentation, the minister will reach out to all the states to hammer out the major issues and bring them on board for implementation,” the source said.
The previous UPA government could not cobble up support for the tax reform, keenly awaited by industry. The GST, which will subsume all Central and state-level taxes including excise, service tax, entry tax, VAT among others, has already passed its deadline of April 1, 2010.
BJP-ruled states including Gujarat and Madhya Pradesh have been the most vociferous in their opposition to the GST. Others like Maharashtra, Karnataka and Punjab have been raising issues on matters like inclusion of entry tax and purchase tax within its ambit.
Meanwhile, similar briefings were also held for Jaitley, who joined office on Tuesday, by the department of disinvestment. “We will go ahead with appointing valuers for HZL-BALCO stake sale. Cannot give a time-frame for stake sale,” said Ravi Mathur, secretary, department of disinvestment, adding that the department is also identifying sick PSUs where government stake can be sold off.
The government holds 49 per cent stake in Balco and 29.5 per cent in Hindustan Zinc Ltd (HZL) and their sale was planned last fiscal. Mathur also said the department briefed the finance minister about the current policy on disinvestment and how minority stake sales take place under the existing policy.