Centre Hopeful Of GST By July 1, States Weren't So Optimistic

NEW DELHI: Days ahead of the next meeting of the GST Council, the Centre said there was a chance that the GST, the national tax regime to replace a clutter of state levies, could be implemented by the middle of this year. Economic Affairs Secretary Shaktikanta Das said he was hopeful that GST - that would turn the country into a seamless common market - could be launched on July 1. But most state finance ministers earlier indicated an early July date may be a little too ambitious, suggesting that something closer to September 15 - the deadline for rolling out GST -  would be more realistic.

The Centre is in the middle of talks with the states to finalise laws that would need to be passed in time for parliament to approve them when the second half of the Budget Session resumes on March 9.

While experts indicate the tax regime could raise the growth rates by one to two percentage points, Mr Das said the hopes of growth were "not just a cliché". Job creation, he said, would also get a boost in coming months due a spike in the budget for infrastructure, including roads and railways.

The GST Council headed by Mr Jaitley - it has state finance ministers as members - cleared the law to compensate states for any loss of revenue on February 18 and is due to meet again on March 4 and 5 to firm up a bundle of related laws.

After these laws are approved, the Council will have to fix rates of taxes for different goods and services by fitting them into the four approved slabs of 5, 12, 18 and 28 per cent.

For a law that has been in the works for more than a decade, Mr Jaitley has already made it clear that the deadline could not be extended indefinitely after parliament took the first step and approved last year's amendments to the Constitution.

The constitutional amendment, which came into force on 16 September 2016, provides for a one-year window to bring in GST. This, Finance Minister Arun Jaitley had explained last year, implied that GST had to be implemented before 15 September "otherwise the country doesn't run".