India's GST Bill stuck in stand-off with opposition

The GST is a key part of Prime Minister Narendra Modi's efforts to streamline India's inefficient tax system.
The GST is a key part of Prime Minister Narendra Modi's efforts to streamline India's inefficient tax system. PHOTO: AFP

Congress disrupts Parliament session; govt has until tomorrow to put Bill to a vote

The Indian government is likely headed for a major setback in its reform drive, with the Goods and Services Tax (GST) Bill stuck in a stand-off with the opposition in the current session of Parliament, which ends tomorrow.

The tax is a key part of Prime Minister Narendra Modi's efforts to streamline India's inefficient tax system, where numerous state and federal taxes push up the cost of products and services.

The GST Bill has been passed by the Lower House, where Mr Modi's ruling Bharatiya Janata Party (BJP) holds a majority. However, it has been stuck in the Upper House, where the party is in the minority.

The government has until tomorrow to put the Bill to a vote, but the Congress Party has continued to disrupt proceedings, accusing Mr Modi of failing to engage the opposition. 

It is understood that the BJP is looking at other options, including calling a special session of Parliament in the coming weeks to get parliamentary approval for the tax.

The government's last-minute push is also tied in with efforts to meet next year's April 1 deadline, the start of the government's new financial year.

The tax faces a lengthy approval process at the federal and state levels that is expected to take months.

The tax needs to be passed by the Upper House before going back to the Lower House for final approval. After that, more than half of the state assemblies would have to ratify it before the tax can be implemented across the country. 

The tax has stirred up some anger in Parliament.

When Finance Minister Arun Jaitley was introducing the GST Bill yesterday, he was rebuked by Congress parliamentarians who shouted "nahi chalegi", meaning "this won't do" in Hindi.

"This kind of disruptionist politics is dangerous," Mr Jaitley said.

"We appeal to the Congress to see reason."

The Congress says it is not anti-GST, but that the Bill needs further deliberation.

It says the GST Bill never went through the Business Advisory Committee, which Congress leaders say should be the body to decide when it should be taken up in Parliament.

Congress has also been disrupting parliamentary proceedings over a separate issue.

It is demanding the resignation of External Affairs Minister Sushma Swaraj and two state chiefs for what it termed as corruption.

"We are not against the GST," said Congress leader Abhishek Manu Singhvi.

The effort to simplify the complicated tax structure has been in the works for over nearly a decade.

Among its early critics was Mr Modi who, as chief minister of Gujarat state, had said a unified tax would be difficult to implement.

A version of this article appeared in the print edition of The Straits Times on August 12, 2015, with the headline 'India's GST Bill stuck in stand-off with opposition'. Print Edition | Subscribe