Finance minister Pranab Mukherjee on Tuesday expressed the hope that the Standing Committee on Finance will soon give its report on the Goods and Services Tax (GST) Bill.
Addressing a meeting of the Consultative Committee attached to the ministry of finance, Mukherjee said he is "hopeful that the Standing Committee on Finance would soon give its report on the bill so that the process of legislation in this direction can move forward".
The meeting of the Committee was attended by ministers of state for finance SS Palanimanickam and Namo Narain Meena. Besides, chief economic advisor Kaushik Basu and Secretaries in the various department of the finance ministry also attended the meeting.
The implementation of Goods and Services Tax (GST) has been hanging in fire since April 1, 2010, the first scheduled date for implementation of the new indirect tax regime.
The GST Constitution Amendment Bill was introduced in the Lok Sabha in February 2011 and the Bill is now pending with the Standing Committee on Finance.
The Parliamentary Panel would give its report after taking into account the views of the Empowered Committee of State Finance Ministers on GST.
The proposed GST would subsume most indirect taxes like excise duty and service tax at the central level and VAT on the state front, besides local levies.
Mukherjee said the Cabinet has approved a Special Purpose Vehicle for launching the IT framework -- GST Network and the Department of Revenue is taking steps to make it functional.
A common IT framework will allow traders all over the country to use their permanent account number, or PAN, as the tax identification number for payment of all direct and indirect taxes.
The move will not only benefit taxpayers but also allow tax authorities to keep a tab on transactions more effectively by linking it with other tax payments.
"GST would check leakage of revenue, and the states should be able to realise tax revenues commensurate to consumption of gods and services within their territory," he said.
Mukherjee said the implementation of the GST would help reduce the overall tax burden on goods, which is currently in the range of 25-30%.
He added that the integration of central excise and service tax is almost complete and the implementation of negative list would help move towards GST.
In Budget 2012-13, the government announced coming out with a Common Tax Code (CTC) for service tax and central excise duty to harmonise the two indirect levies. Also, the rates of service tax and excise duty was raised to 12% from the current 10% level.