Mumbai: The Parliamentary panel on Goods and Services tax (GST) is expected to submit final report before the monsoon session, chairman of the Empowered Committee of State Finance Ministers Sushil Kumar Modi said on Saturday.
“We are inching towards GST rollout, but not very fast. One of the major obstacles has been crossed as the Parliamentary Standing Committee on Finance will start deliberations from 8 June on the GST Constitutional Amendment Bill,” Modi told a seminar on GST here.
Sushil Kumar Modi, chairman, Empowered Committee of State Finance Ministers
“Committee chairman Yashwant Sinha has assured me to complete deliberations and prepare the report before the Monsoon session,” he added.
However, Modi refused to set a deadline for GST rollout, saying, “I can’t give you a deadline on GST implementation as the states have many apprehensions about the actual import of the new common tax regime.
“The Centre needs to address the concerns of the states to ensure its rollout. Moreover, the ongoing political uncertainties at the Centre may also create some hurdles.”
However, Modi pointed out that the GST network or the technology platform for the new common tax regime, which will make the country a single market enabling easier and cheaper movement of goods and services, will be in place by August.
Calling for more interaction between the Centre and the states to resolve the differences, Modi said the Centre is yet to assure the states on fiscal autonomy, powers to fix tax rates and impose levies, compensating the states for their revenue loss and establishing a dispute settlement authority. Listing out the issues of the states, he further said, “The major concern is with regard to fiscal autonomy. Some states are of the view that the constitutional amendment will take away their fiscal autonomy.”
Modi also expressed displeasure over the Centre not meeting its commitment to compensate the states for their losses arising from halving the Central sales tax or CST.
“So far the Centre has given only Rs 6,000 crore in compensation to the states against an actual loss of Rs 19,000 crore last fiscal,” Modi said.
In the run-up to the GST rollout, the centre had planned to phase out CST and slashed the rate of CST from 4% to 2% with a promise that the states would be compensated for the loss arising out of reduction in CST rate.
But with the Centre’s own finances being under pressure, it has not done so.