The government and the Congress Wednesday continued to hold a “constructive dialogue” to arrive at a formulation that does not require the specification of the GST rate in the Constitution, but assures a legal ringfencing that would guard against random increases in indirect tax rates.
According to sources in the Congress, Union Finance Minister Arun Jaitley and Parliamentary Affairs Minister Ananth Kumar are learnt to have met Congress leaders Ghulam Nabi Azad, P Chidambaram and Anand Sharma on Wednesday. This is the second structured meeting after they held discussions last Friday.
A Congress leader told The Indian Express, “The negotiations are on. Talks are happening in a constructive fashion. But it is a complex issue and an outcome is still elusive.” Another leader said the present Bill was flawed.
In an interview to Karan Thapar of India Today TV, Chidambaram said the Congress was not opposed to Goods and Services Tax, but added that the Bill pending in Parliament was a “flawed one”. The Congress had demanded three changes, including that of specifying the 18 per cent GST rate in the Constitution.
“There are various ways to reach a point, there are various ways of doing it. I think you must understand why we want certain degree of certainty about the rate. GST is an indirect tax (and) by definition it is a regressive tax,” Chidambaram said. “We don’t want that rate to be fiddled around by executive orders. We need a certain degree of certainty. If the government is clever, then it can come up with any formulation that is acceptable, provided it (the GST rate) is not changeable at the whim of executive order,” he added.
The former finance minister said the government has to put its views on any modification to the Bill in writing before the Congress can take a stand on the legislation. “If you are willing to modify those clauses, the minimum we need to know is language of modified clauses. Once modified draft comes, we may agree, we may ask for changes there. I think we should get the modified draft (first).”
Meanwhile, the CPM Wednesday said it was not opposed to the provisions of the GST Bill per se. Addressing the media, CPM leader Sitaram Yechury said the chair of the empowered group of state finance ministers was the former Left Front finance minister of West Bengal Asim Dasgupta. “What you see in the GST Bill is the recommendation of that committee. We have recommended it. But there are two matters of concern,” Yechury said.
He said that in the current Bill, a state will not have the right to impose a surcharge or a cess or a tax to raise resources to give people relief even in the case of a natural calamity. “What will it do, come with a begging bowl to the Centre?” Yechury said. “We are saying call an all-party meeting and discuss these issues,” he added.