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Amendment bill on GST unlikely this session

delhi Updated: Aug 19, 2010 21:09 IST

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The much-awaited Constitution Amendment Bill on GST is unlikely to be tabled in this session of Parliament in the face of opposition from the BJP, among others.

"The bill is not likely in the Monsoon Session," an official source said in New Delhi.

However, they said GST could still be implemented from the target date of April 1, 2011, even if the Constitution Amendment bill comes up in the Winter Session.

Finance Minister Pranab Mukherjee had requested the states to let the bill be tabled in the Monsoon Session, and sort out the differences alongside.

"The priority for now is the finalisation of draft Constitution amendments so that the Amendment Bill may be introduced in Parliament during the ongoing Monsoon Session... It must be appreciated that Constitution Amendment is only an enabling provision. It does not prohibit us from continuing our dialogue on rates," the Finance Minister had said yesterday in his interaction with the state GST panel.

BJP-ruled states and a few others have opposed the revised draft of the bill, saying it does not clarify how the changes will be brought about in the GST structure.

The earlier draft was rejected by states after they said it proposed veto power to Union Finance Minister over state taxation issues.

The first draft had proposed setting up of a GST Council to take decisions on GST with the consent of the Union Finance Minister and two-third majority of states.

The revised draft, however, said the council could take a decision only when there is a consensus.

However, BJP-ruled states wanted to know the clear meaning of consensus and suggested changing this word with "consent". Both the drafts have also suggested a Dispute Settlement Mechanism.

Finance Ministers of BJP-ruled states and representatives from Uttar Pradesh sought another month to firm up their views.

"We have asked for one-month time to study the revised draft. Eight to 10 states have opposed dispute settlement mechanism, including Tamil Nadu and Uttar Pradesh," Madhya Pradesh Finance Minister Raghavji said.

Mukherjee said a third revised draft would be prepared to sort out the concerns of the states.

GST is expected to replace excise duty, service tax on the Centre's front, VAT at states end, besides cesses, surcharges and local levies.

The earlier deadline of implementing GST from April 1, 2010, was missed due to differences between the Centre and states over the GST structure.