GST: India's tryst with new tax reforms

The Goods and Services Tax (GST), India's biggest tax reform since Independence, rolled out past midnight on Friday in the precincts of the Central Hall of Parliament to usher in a new indirect tax regime in an event that sought to evoke memories of the famous 'Tryst with Destiny' night the country got freedom in 1947.
A minute after the stroke of midnight, President Pranab Mukherjee and Prime Minister Narendra Modi pressed the button to launch the new indirect tax regime on a digital screen with 'GST' emblazoned on it in a golden hue.
Conceived on the principle of 'one nation, one tax, one market', the tax that subsumes 17 central and state levies was launched in the presence of Vice-President Hamid Ansari, former Prime Minister H.D. Deve Gowda, Lok Sabha Speaker Sumitra Mahajan, Finance Minister Arun Jaitley, MPs, chief ministers, state finance ministers, officials of the Centre and states.
Notwithstanding the fact that the GST Law was a consensus product evolved over 14 years, the function was boycotted by major opposition parties such as Congress, Trinamool Congress, RJD, DMK and Left parties, saying the government was making a spectacle of a legislation for self-promotion. In keeping with his party's decision, former Primer Minister Manmohan Singh kept away from the event. However, MPs and leaders of Congress allies NCP and Samajwadi Party attended the function.
Addressing the gathering, President Mukherjee said the introduction of GST is a moment of precedent for the country and a matter of personal satisfaction for him because of his role as Finance Minister earlier. "I had always believed that GST was a matter of time and was happy when it was enacted and I gave assent to the Constitution amendment last year," he said.
He said the new law is a tribute to the maturity and wisdom of Indian democracy. The GST Council was a unique experiment under the Indian Constitution because of the shared sovereignty.
In his speech, Modi said the rollout of GST is the best example of cooperative federalism and success of Indian democracy. "The credit for the new law does not go to one party or one government but was a shared legacy of all," he said.
The Prime Minister said there cannot be a "better and sacred" venue than the Central Hall for the historic rollout.
The GST process cannot be confined to just the economic system but was a collective effort of all, he said, adding it was a product of long discussions among the best brains of the country. "It is an example of Team India's strength and ability," he said.
Referring to eminent personalities such as Jawaharlal Nehru, Sardar Patel, Maulana Abul Kalam Azad and Babu Rajendra Prasad who had adorned the Central Hall, Modi said like Patel had integrated the country, the GST would integrate the country economically.
He described the GST as 'Good and Simple Tax' - good because there will be no tax on tax and simple because there will be only one form of tax. It will also help eliminate black money and corruption because of the transparency it seeks to bring in, he said.
Modi said whatever was lacking in growth and development of the country, GST would provide the opportunity to realise them.
Jaitley described GST as the biggest and most ambitious tax reform which is an achievement of the country through consensus. It highlights the fact that India can rise above narrow politics and work for the country's benefit. In making the GST, neither the Centre nor the states gave up their sovereignty.He said all MPs, state governments, political parties, state finance ministers and dedicated officials of the Centre and states deserved to be appreciated for realising the project of GST Law.
Jaitley said under GST, revenues will go up as the compliance increases and the GDP would also increase. - IANS

source: Khaleejtimes