Union finance minister
Pranab Mukherjee and Asim Dasgupta, head of the group of
the empowered committee of state finance ministers on
Goods and Service Taxes (GST), will issue a joint
statement on January 8 about the final rollout of GST.
On the sidelines of the 23rd Industrial India Trade
Fair, the West Bengal finance minister told reporters
that a meeting between the empowered committee of state
finance ministers and the concerned authorities of the
finance ministry would be held on January 7 and 8,
following which the finance minister and he will issue a
joint statement. “I am in constant touch with the Union
finance minister and on that date (Jan 8) we will
declare the new date of the GST rollout,” Dasgupta said.
In fact, the Union finance minister on Thursday said
that although there has been considerable progress
towards implementation of GST, it would not be possible
for the government to introduce GST on April 1, 2010.
GST, he said would be implemented in appropriate time.
However, Dasgupta till recently was optimistic about
rolling out GST on April 1. Presenting the first
discussion paper at the Ficci’s national executive
recently, he pointed out that the last phase of
activities would be carried out in such speed that the
government would be able to implement GST from April 1,
2010. “The effort one gives just a night before the
examination is the best effort. It enables one to cover
the entire syllabus in one night. In the same way our
effort towards the end of the dateline will push us in
attaining our goal,” Dasgupta had said at the Ficci
seminar.
But Mukherjee is of the view that the states and the
Centre are yet to reach a consensus on the issue of
states’ autonomy on taxing. Dasgupta said the empowered
committee of finance ministers has not denied the
autonomy of states on taxation and would create a
mechanism to compensate the states of the losses, which
they would face for introduction of GST.
Many states would lose considerable revenue if the
purchase tax, which many states impose, is subsumed to
GST and the Centre would have to make compensating
adjustments for that, Dasgupta said.
According to a finance ministry official, while there
are a lot of decisions pending on matters relating to
compensating the states for losing revenue, getting the
Parliament nod would involve considerable time. Besides,
in view of the present fiscal situation, compensating
the states for losing revenue due to GST will not be
easy. Plans of further compensation means fuelling
further fiscal deficit, the official said. However,
Mukherjee said as the government has planned a dual GST,
it could be kept on the concurrent list.
