As per a report in Live Mint, the rollout of the goods and services tax
(GST) is likely to be delayed by two or three months, according to two
people familiar with the situation.
The government is yet to lock
down a date, but is likely to settle for either 1 June or 1 July, the
people said on condition of anonymity.
Expectations are that the
GST legislation will be introduced in the first half of the budget
session and the government will seek to get it passed after the recess.
the new dates would delay the rollout, they are also well within the
mandatory deadline of September—after which the central and state
governments will lose powers to levy any indirect taxes other than GST.
between the centre and the states, especially over the sharing of
powers, has delayed the final approval for supporting legislations for
GST, a tax reform which will for the first time bind the country into a
States like Kerala and West Bengal had sought a
delay in the implementation of the tax, arguing that state finances
cannot withstand the double whammy of demonetization and GST.
will subsume a host of indirect taxes levied by the centre and the
states, including excise duty, service tax, value-added tax, entry tax,
luxury tax and entertainment tax.
Though its implementation would
have been easier from the beginning of a fiscal year, it can be
implemented anytime. GST is an indirect tax levied at the point of sale
and hence can be introduced at the beginning of any month.
minister Arun Jaitley is expected to announce the timetable for this
ambitious tax reform in his budget speech on 1 February.
The finance ministry will also have to work out its revenue estimates for 2017-18 based on GST’s implementation date.
eyes will now be on the crucial 3-4 January meeting of the GST council
in New Delhi that will discuss the contentious issue of sharing of
administrative powers between the centre government and the state
A consensus is imperative for the integrated GST
bill that deals with the levy of GST on inter-state movement of goods to
receive the council’s approval.
So far, after months of
deliberation, the council has approved the draft central and state GST
legislations, and has given its nod to the bill on the compensation of
states for revenue losses arising from a transition to GST.
the central GST bill, integrated GST bill and the bill on the
compensation of states for revenue losses will be tabled in Parliament,
the state GST bill has to be tabled in state assemblies.
April 1 looks difficult, the government has little option but to bring
in GST from any month next year. Since it is a transaction tax, it can
be brought in at any time. However, the challenge will be to do a
revenue forecast in the budget. It will be prone to huge errors,” said
N.R. Bhanumurthy, a professor at the National Institute of Public
Finance and Policy.