[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]T[/dropcap]he Government’s hope of passing the Goods and Services Tax (GST) amendment legislation in the parliament depends on to the extent it will be ready to accommodate three key demand of the Congress party.
The demands – scrapping one percent additional tax on inter-state sale of Goods, a cap of 18 percent for GST rate through constitutional amendment, and an independent dispute resolution mechanism for GST – are old, but now the party has made clear that they are not a subject of negotiation.
“Unless the government responds on this we will not compromise,” Congress president Sonia Gandhi and vice president Rahul Gandhi told NDTV channel.
[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]T[/dropcap]he private broadcaster claimed that the two leaders countered Finance Minister Arun Jaitley’s claim that he had spoken to every Congress leader on the GST bill.
“The finance minister came and called on us separately to give us his daughter’s wedding invitation. It was a personal call,” the Gandhis said to questions on Jaitley visiting them.
On Wednesday, in Bengaluru Rahul Gandhi had said that his party was willing to support the passage of the BST bill if the Government reached out to the Congress. “The government has to accept that Congress sits in Parliament, has a view and 20 per cent vote,” he said.
Leader of Opposition in the Rajya Sabha, Ghulam Nabi Azad said that the Congress wanted the GST bill to be both pro-industry/ trade and pro-consumer. “We want a cap on the GST rate so that it’s not raised later,” he said.
[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]U[/dropcap]nlike in the monsoon session when the Congress-led opposition was not ready to allow transaction of any business over the Lalitgate, this time around there is a willingness to let the house function. Both the Opposition and the ruling BJP feel that public opinion is against a logjam in parliament and the middle class will punish them for not coming together to pass reform measures that will help the masses.
The Government has assigned Arun Jaitley to convince the Opposition parties to back the GST bill. While most of the Opposition parties seemed ready for a give-and-take approach, they also feel that the Government should have opened discussions well before the winter session to sort out differences over crucial legislations.
With the Congress coming out with three pre-conditions for the passage of the bill, the Government will have limited options but to accept these demands and pass the crucial legislation that would significantly add to India GDP.
[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]T[/dropcap]he international investment community is also keenly watching the developments over the GST bill. If the Bill is passed with consensus, then the stock market could finally come out of months of stagnation and head towards new highs by the year end. This will also help the Government to meet its divestment target of Rs 69,000 crores ($10.4 billion)
Last week, Jaitley had expression fear that India might not meet its disinvestment target if the stock market remained sluggish and metal companies continued to underperform internationally.
1. The conversion rate used in this article is 1 USD = 66.35 Rupees.
2. Text in Blue points to additional data on the topic.
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