GST Congress' Bill; Negativism Hurting Economy: Jaitley


NEW DELHI: Racing against time to get the GST bill cleared from Parliament, Finance Minister Arun Jaitley attacked the Congress for blocking the legislation that it had itself brought in and said 'obstructionist' tendencies and negativism were hurting the country and its economy.

Acknowledging that there may be merit in Congress' demand for 18 per cent rate of GST, he said the NDA government has "not made any significant modifications" to the bill that the Congress-led UPA government had proposed in 2006-07 Budget, "except to bring a consensus between manufacturing and the consuming states".

"The state governments belonging to the Congress party have consistently supported the proposal. Is it only out of an obstructionist attitude that the Congress has adopted a negative role?" he asked.

The government needs Parliament to approve the Constitution Amendment Bill in the current monsoon session ending August 13 before half of the 30 states clear it and the new regime is rolled out from April 1, 2016, so that a nationwide Goods and Services Tax (GST) can replace all existing indirect taxes like excise and VAT.

However, Parliament proceedings have been repeatedly getting disrupted over issues like Lalit Modi controversy and the Vyapam scam for the past two weeks.

"Since Parliament is not functioning and there is no way to clarify these points before the same, I am constrained to place the above facts in public domain," Jaitley wrote in a Facebook post titled 'Dissent or Disruption - The Congress Party's Position on GST'.

He said the Congress and its leader "may be upset with the government for political reasons. They may be upset with the electorate for the 2014 verdict".

"The Congress party should accept and seriously introspect after having ruled the country for the longest period of time, that negativism hurts the country. Should its obstructionist tendencies inflict an economic injury on the country?" he wrote.
Giving a point-wise rebuttal on the Congress party's dissent note to the Select Committee's report on GST, Jaitley said the rationale of the bill is to simplify the complex indirect tax structure in the country.

"The present system involves multiplicity of taxes, absence of uniform rates of taxation, and the cascading effect of 'Tax on Tax'. It is also an impediment to the seamless transfer of goods and services across the country," he said.

The GST Constitution Amendment Bill has been cleared by the Lok Sabha and is waiting for nod of the Rajya Sabha, where the ruling NDA does not have a majority.

The report of the Rajya Sabha Select Committee was tabled in Parliament last month. The Committee had suggested to compensate the states fully for five years for any revenue loss for GST rollout. However, the Congress, the AIADMK and the Left had submitted dissent notes on the same.

Jaitley said the proposal for introduction of GST was first mooted by former FM P Chidambaram in his Budget for 2006-07.

"After detailed deliberations and negotiations in the Empowered Committee of State Finance Ministers, the 115th Constitution Amendment Bill, 2011, was introduced by Pranab Mukherjee, the then Finance Minister," he said, adding that the Bill was referred to the Parliamentary Standing Committee, which submitted its report in August 2013.

The bill, however, lapsed with dissolution of the Fifteenth Lok Sabha. Thereafter, the NDA government again held negotiations with the Empowered Committee and after an overwhelming consensus, introduced a bill incorporating certain changes which had also been recommended by the Parliamentary Standing Committee.

The bill was approved by the Lok Sabha and when it came to the Upper House, it was referred to a Select Committee which has recommended a five-year compensation to the states which suffer any revenue loss on account of introduction of GST, he said.

Jaitley rejected Congress' dissent notes to the Select Committee report, saying the suggestions being made now were never part of either Mukherjee's Bill or that of Chidambaram's proposal.
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Source: PTI