GST(Goods and Service Tax) Amendment Bill introduced: A New Wide-Ranging Tax Regime

The GST, which is considered to be a major tax reform, has been pending for the last four years due to differences between centre and some States over the structure of the new tax regime.

The Goods and Service Tax (GST) constitution Amendment Bill was introduced in the Lok Sabha with a view to confer simultaneous powers on Centre and States to levy taxes on goods and services. The Bill, introduced by Finance Minister Pranab Mukherjee, would subsume levies like excise, service tax and sales tax.

“The GST would replace a number of indirect taxes presently being levied by the central government and the State governments and is intended to remove cascading of taxes and provide a common national market for goods and services”, said the statement of objects and reasons of the Bill.

The Bill provides for creation of a GST Council to be headed by Union Finance Minister. The Council will be empowered to recommend tax rates and exemption and threshold limits for good and services. Besides, the bill also proposed a GST Dispute Settlement Authority in order to deal with grievances of the centre and the state with regard to GST.