New Delhi: Prospects of the Union government meeting its 1 April 2017 implementation deadline for the goods and services tax (GST) look bright as states across the political spectrum are moving swiftly to ratify the seminal tax reform.
At least 11 states, including those governed by the Bharatiya Janata Party (BJP) and opposition political parties, are in the process of ratifying the legislation. This is over and above the three states—Assam, Bihar and Jharkhand—that have already done so.
The 122nd constitution amendment bill to roll out GST has been sent to the states for their ratification after it received Parliament’s nod. The bill needs the backing of at least 16 states before it can be sent for presidential assent.
GST is intended to dismantle interstate barriers in trade in goods and services and create a common market of 1.25 billion people.
The states that have announced their intent to ratify the legislation include the Trinamool Congress (TMC)-led West Bengal, the Congress-led Karnataka, the Telangana Rashtra Samithi-ruled Telangana and the Aam Aadmi Party (AAP)-led Delhi.
In the race to be the third BJP-ruled state to ratify GST after Assam and Jharkhand are Goa, Haryana, Madhya Pradesh, Chhattisgarh, Gujarat and Maharashtra. A National Democratic Alliance (NDA) member, the Telugu Desam Party, is also planning to call a special sitting of the Andhra Pradesh assembly for the purpose.
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After Nitish Kumar-led Bihar became the first opposition party-ruled state to ratify GST earlier this week, Karnataka could become the first Congress-led state to do likewise.
The Congress had initially opposed the bill, forcing nearly a year’s delay. It was only after the government conceded some of its demands that the party rallied behind the legislation.
“If at all the state considers ratifying the GST bill, it will happen only in the winter session, likely to be held in November or December," said D.K. Shivakumar, senior Congress leader and Karnataka energy minister, on Thursday.
The TMC is set to call a two-day special session of the West Bengal assembly from 26 August to ratify the bill. Incidentally, state finance minister Amit Mitra is the chairman of the empowered committee of states on GST.
Telangana, whose support for the bill was acknowledged by Prime Minister Narendra Modi during his visit to the state earlier this month, will ratify the landmark legislation this month. “Already our chief minister had convened a meeting, and it was decided to summon the assembly as early as possible and urgently pass it," state finance minister Etela Rajender told PTI earlier this week..
Similarly, the AAP-led Delhi government is convening a four-day legislative assembly session from 22 August during which the legislation could be ratified.
Among the NDA-ruled states, Andhra Pradesh chief minister N. Chandrababu Naidu has said that his government will ratify the bill soon.
At a two-day monsoon session beginning 22 August, the Gujarat assembly will ratify the bill. “The main agenda for the monsoon session is the constitutional amendment bill on GST, which is expected to be introduced and passed in the assembly in the monsoon session," said a senior government official in the state’s finance department who did not want to be named.
The BJP-ruled Madhya Pradesh will hold a special one-day assembly session on 24 August to ratify the GST constitution amendment bill, said a state government official.
Another BJP-ruled state, Chhattisgarh, will take up ratification at a special assembly session on 22 August, said state industry secretary Subodh Kumar Singh.
An official at the Goa legislative assembly secretariat said that the state would most likely call a special session by the end of the month or the first week of September. “We have not yet received papers from the centre asking the state to ratify the GST amendment bill. We hope to get the papers in a couple of days, after which we will finalize the dates for the special session," the official said, requesting anonymity.
Neighbouring Maharashtra, too, will call a special session of the assembly to ratify the constitution amendment bill, chief minister Devendra Fadnavis said on Friday, adding that dates for the session have not been finalized yet.
Maharashtra’s parliamentary affairs minister Girish Bapat said the special session could be called around 1 September. “The special session will be on the agenda of the cabinet meeting on 23 August. Once the cabinet approves it, it will go to the business advisory committee of the legislature. We are aiming to hold this special session around 1 September," he said.
“The passage of GST indicates improvement in the political culture, and both opposition and government should be credited for it. Government is talking to all states. It is not about centre versus state, which is the big message," said A.K. Verma, a Kanpur-based political analyst and political science professor at Christ Church College.
“We are witnessing a change in political culture and federal structure where governance is at the forefront," he added.
Once the constitution amendment bill is enacted, the government will set up a GST council that will decide on crucial issues such as tax rates and finalize three GST laws. The government is aiming to table the central GST law and the integrated GST law in the winter session of Parliament. The state GST law will go to all the states for passage.
Sharan Poovanna and Nidheesh M.K. in Bengaluru, Abhiram Ghadyalpatil in Mumbai and Maulik Pathak in Ahmedabad, and PTI contributed to this story.