The roadmap to implement a countrywide goods and services tax (GST) has got delayed by a month.
State governments have told the Centre that they need one more month to discuss the draft Constitution Amendment Bill.
The Centre has proposed a three-rate structure for the GST, which if adopted, can dramatically alter tax administration by giving a one-shot solution to a welter of levies such as excise, value added tax and octroi.
It will be a single national uniform tax levied across the country on all goods and services.
Finance Minister Pranab Mukherjee, who met state finance ministers on Wednesday, said the proposed GST Council will only be a recommendatory body and all decisions will be taken by consensus.
"The decisions of the GST Council would be 'recommendations' to the Union and the states," he told a meeting of the Empowered Committee of State Finance Ministers.
The Bill, the tentative draft copy of which is with HT, has diluted the Centre's earlier position of empowering itself with veto powers to overrule decisions, but has proposed the setting up of a Goods and Services Tax Council (GST Council) that would be headed by the Union finance minister.
Mukherjee assured the states that their concerns will be addressed by the joint working group in the third draft.
Earlier in the day, the Empowered Committee met under the chairmanship of West Bengal Finance Minister Asim Dasgupta, where BJP-ruled states sought one months' time to respond to the revised draft.
"The states have got hardly two working days to examine the revised draft and take a decision thereon." Madhya Pradesh Finance Minister Raghawji said.
"I have been wondering the reason for the rush to implement the GST as if the country is passing through a severe financial crisis and GST is the panacea for all the ills," the minister added.
The government plans to introduce the new tax system from April 1, 2011.