Source: Agencies03 Aug 2016 20:01:43
New Delhi, August 3: Over the discussion over GST bill in Parliament, former Union Finance Minister and Congress MP P. Chidambaram shared his views in the Rajya Sabha on Wednesday. Pointing for 18 percent rate as appropriate for GST, he said, “The empowered committee is the one which arrived at a 15.5 per cent revenue neutral rate and came to the conclusion that 18 per cent should be the appropriate GST rate. The Congress did not suggest the 18 per cent rate -- 18 per cent came out of your report," he said.
Finance Minister Arun Jaitley moved that the GST Bill – The Constitution (One Hundred and Twenty-second Amendment) Bill, 2014 be discussed and passed in Rajya Sabha. Both – the Treasury and Opposition benches are debating the bill for an allotted time of five hours.
His reference was to the committee currently chaired by West Bengal Finance Minister Amit Mitra. "If we charge 24-26 per cent, it will defeat the very purpose of GST. Services represent 57 per cent of India's GDP. It will be hugely inflationary if we raise it. It'll lead to tax evasion," said the former finance minister.
"Today we may not put the rate in the Constitutional amendment bill but we will have to put it in the central bill, why such a step can't be taken by Finance Minister Arun Jaitley while moving the amendments”, he said.
Chidambaram said the reason why indirect tax has to be low is due to its regressive nature. "Take the case of soft drink, whether a rich man buys it or poor man buys it, the tax is the same," he said. Earlier, Chidambaram said he was glad that the government had accepted his party's demand not to permit a 1-percent additional levy by some states, so that they can get themselves compensated for any revenue loss that they may incur due to the shift to GST.
Anand Sharma from INC while sharing his views on GST bill said, “Dialogue on GST incomplete without talking about its origin. Then BJP-led Opposition said Congress’ GST Bill push would weaken states, even called it ‘unconstitutional’. Would’ve been better had there been better dialogue when Finance Minister Chidambaram tried to take GST Bill forward. Still believe it was a momentous, historic moment for the Congress.
D Raja of CPI Party said, “It is very clear we are yet to understand what would be the future. The whole effort is to create a common economic zone in the market. We are going to enter an unknown terrain. We are not very clear on the consequences. Interests of the working class must be kept in mind. The contentious issue is about capping of the GST rate. Centre has to ensure that the indirect taxation doesn’t adversely affect the tax payers. The finance minister has to explain further.
TMC MP Derek O’Brien also quoted what the two parties had said in the past on the GST bill, saying it was important that the politics of the GST bill be discussed, because for two years, two houses were stalled by the BJP over GST and FDI.
He also took on Chidambaram, saying his colleagues in the Select Committee saw the Go Slow Tactics of the Congress Party. “Only having an idea of GST is not good, there has to be implementation,” O’Brien said.
Derek O’Brien also listed countries that have come back to power and suffered defeat after governments passed the GST bill, comforting both parties that it was a fifty-fifty chance.