GST Bill :One Nation , One Market
The Most discussed and debated GST Bill (Goods and Service Tax ) is amended in the upper house of the Parliament Rajya Sabha today.Voting has been initiated by vice chairman Kurien and Total 197 of 197 MPs vote ‘YES’ which passed the bill unanimously.It had taken India a decade to bring a necessary reform.
The NDA Government failed to pass the bill in Rajya Sabha in 2015 though it succeeded in Lok Sabha (Lower house) due to less strength of NDA representatives in the upper house.However, the bill was passed in the upper house due to the arrangements and efforts made by the finance minister Arun Jaitley, this time, to come out with flying colours. He moved a total of four amendments to pass the 122nd amendment bill known as the Goods and Service Tax bill.
The approval of the GST bill by the upper house was cheered up by many industrialists and CEOs of major enterprises.They said that Modi government had taken a extremely significant measure.
Finance Minister Arun Jaitley said that the GST bill will bring three major changes.They are
1. System will be more efficient.
2.No cascading effect of tax on tax
3. Lower or no tax on certain item
After long time debates, Modi government finally secured the support of the main opposition Congress party to nod yes by telling “ I” for the approval of the GST bill in Rajya Sabha. The official amendment to Goods and Service Tax bill will be on the debate from 2 pm on Wednesday. The government is eager to wrap up all the discussions and bring in the new tax reform.
What you need to know about GST BILL:
• GST bill or good and service tax bill seeks to amend the constitution to provide a comprehensive indirect tax which includes central excise tax, service tax, sales tax, excise duty, VAT, etc. through this amendment government is seeking to implement a single tax comprising the multiple indirect taxes.
• The bill restricts the taxation of the interstate sale or purchase of the goods.
• The bill seeks to establish GST council which will optimize the tax collection of state and centre
• The government assured 100% compensation for states for five years if losses are incurred in GST implementation.
Key benefits of GST:
• Single tax replacing many existing taxes on goods and services
• Reduces price in long run helps in economic growth
• Uniform tax system with greater transparency
• Lower prices of manufactured products, increase in sales
• 10% GDP growth expected.
Positives post GST bill:
• According to the finance minister, the bill helps in increasing the GDP by 2%.
• The GST rate can be fixed at 17-18%, which is currently 25-17% more for a product. Hence the price of goods can come down,
• Automobiles like cars, two wheelers, shampoos, tea powers, (FMCG goods ) logistics and cement will see a price fall of at least 10%.
• Consumer durables like TVs, refrigerators, fans, mobiles electronic gadgets made in India will see a price drop if the bill is approved. Movie tickets will see a price drop if the GST bill gets passed.
Negatives post GST bill:
• The present service tax levied is 15% which will be increased to 18-20%. Though the goods price reduces, the service sector will impose heavy taxes.
• Luxury hotels, spas, air tickets will see an exponential growth in the rates. If GST is implemented 9-12% increase in the tax amount of air tickets will be seen.
• Bank loans, financial services, insurance premium, investments, telephone services, pharma products, medicines can see an increase in price.
• Cigarettes, branded clothes, branded jewelry and mobile phone calls may see an increase in price after GST bill is passed.
The government of India made nine changes to the previous bill that was passed in Lok Sabha to get support from the Congress party. The opposition leaders put forward three points to accept the bill. Finance minister stepped down for two demands and convinced the leaders for smooth approval of the bill.