GST draft bills tabled in Parliament; peg peak rate at 40%
- Author: Megan Austin Mar 30, 2017,
Mar 30, 2017, 1:37
The bills included the Central Goods and Services Tax Bill, and three allied bills.
As soon as the Constitutional Amendment Bill was passed in Parliament, social media was bombarded with messages that suggested GST would bring about a revolutionary change; that it would be only "one tax" for "one country".
Moily also slammed the Narendra Modi government for "high as well as too many taxes under the proposed GST system which he said does not reflect the original spirit behind the new tax regime".
Moving a motion in Lok Sabha, Finance Minister Arun Jaitley hoped that all the related Bills would be passed with consensus.
The GST bills provide that sale of land and, sale of building except the sale of under construction building will nether be treated as a supply of goods not a supply of services.
The Central Goods and Services Tax (GST) Bill 2017 will make provision for levy and collection of tax on intra-state supply of goods, services or both by the central government.
Terming it a "created controversy" Finance Minister Arun Jaitley said, "We got became one political entity in 1947 but remained multiple economy markets.it is for the first time that we are creating a Federal institution with states legislators and centre pooling their sovereignty to the GST council".
The passage of bills is seen as a major step towards implementation of Tax reform in the country from July 1.
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The basic principle to determine tax on items will be to find out the current tax components and bracket them under the nearest tax slab so that the prices do not increase, he said. He emphasised that GST will not be inflationary, and assured that once tax rates are aligned, petroleum products will also be taxed under the new regime.
There are five different tax slabs, beginning with zero rate, 5 percent, 12 percent, 18 percent and 28 percent.
He said the division of powers between the centre and the states on taxes are clearly defined in the bill.
The States will pass the State GST or SGST law that will allow them to levy sales tax after levies like VAT are subsumed.
Moily also attacked government claiming that the GST mantra "one country-one tax " is a myth. The IGST will be a tax on inter-state movement of goods and services.
The Finance Minister said that luxury goods or sin commodities, which have adverse effect on health will call for approximately the same effective taxation rate. The Congress led opposition decided that it would not accept GST amendment Bill in its present form and press for more amendments in the Rajya Sabha.
"We are not opposed to the GST taxation but the manner in which the Bill has been presented is absolutely retrograde", he said.