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GST bills passed: Opposition faces political dilemma

LiveMint logoLiveMint 29-03-2017 Anuja

New Delhi: Opposition party members debating four pieces of supporting legislation on the proposed goods and services tax (GST) on Wednesday were faced with a classic political dilemma—they did not want to be seen as either opposing the bills or fully supporting the government.

Taking credit for the passage of the constitutional amendment bill last year and the present batch of supporting legislation, the Congress and Mamata Banerjee-led Trinamool Congress said that the two parties had played a crucial role in pushing these bills.

Senior leaders of the Congress argued that the GST bill should have been passed during the tenure of Congress-led United Progressive Alliance (UPA) government itself, but that it was blocked by the Bharatiya Janata Party (BJP), then in the opposition.

ALSO READ: All GST bills passed in Lok Sabha for uniform taxation across India

Soon after the debate was initiated by finance minister Arun Jaitley, the first speaker for the Congress party, former cabinet minister M. Veerappa Moily said that due to the delay in the roll-out of the GST, the country had lost around Rs1.5 trillion annually, with total losses amounting to Rs12 trillion. Moily asked who would compensate for the losses.

“Seven to eight years have passed after the erstwhile UPA government wanted to bring the GST bill. Some parties then felt it should be halted due to reasons best known to them,” Moily said leading the Congress’s arguments in the Lok Sabha.

Eventually, the opposition parties’ position crystallised around opposing certain aspects of the bill, including its impact on the federal structure and state finances, while they kept up their political barbs over the delay in passing the bill.

The sharpest attack came from the Congress party.

ALSO READ: GST: Pooling sovereignty, promoting federalism

“One nation, one tax is only a myth. No one can call these bills a game changer. It is just a small baby step forward...Anti-profiteering provision is draconian in nature. It will cause hardships to industry,” said Moily.

A significant amount of Moily’s criticism was trained at the powers of the GST Council.

“The GST Council is only a coordinating body. It is an extension of the executive. It cannot take away the powers of the legislature,” Moily said adding that as per the current wordings of the bill, only the GST Council and the Central government matter.

Moily’s opposition to the GST Council is surprising since Congress state finance ministers are also part of it. In addition, Congress criticism of this aspect comes too late as the GST Council’s powers and jurisdiction were defined in the constitution amendment bill which received the Parliament’s nod last year.

ALSO READ: GST caps Arun Jaitley’s finest hour in public life

The Trinamool Congress, which has been one of the most vocal supporters of the GST, reminded the ruling National Democratic Alliance (NDA) that West Bengal chief minister Mamata Banerjee, had in-principle supported the concept of GST as early as 2009 in the party’s manifesto.

The passage of the bill was made possible only after political parties, including opposition parties like Congress and Trinamool Congress, extended their support in the Upper House, where the NDA didn’t have the required majority for the bill.

Mohammed Salim of the Communist Party of India (Marxist) also spoke about the powers of the GST Council, cautioning that it should not become a “clone” of Parliament. He also criticized the bill, saying it was “unifying taxes but dividing people”.

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