Cong iso­lated as Left backs GST bill

Hindustan Times ST (Mumbai) - HT Navi Mumbai Live - - NAVI MUMBAI - Saub­hadra Chat­terji saub­hadra.chat­terji@hin­dus­tan­times.com

NEW DELHI: The coun­try’s largest com­mu­nist party said on Satur­day it saw no need to cap a pro­posed Goods and Ser­vices Tax (GST), iso­lat­ing the op­po­si­tion Congress fur­ther on a con­tentious clause and bright­en­ing the gov­ern­ment’s chances of win­ning par­lia­men­tary ap­proval for the mea­sure.

Po­lit­i­cal dif­fer­ences have held up the GST, with the Congress re­fus­ing to back it un­less the gov­ern­ment agreed to cap the tax rate at 18% and cre­ate an in­de­pen­dent mech­a­nism to re­solve dis­putes on rev­enue shar­ing be­tween states.

But the Com­mu­nist Party of In­dia (CPI-M), which also op­poses sev­eral other re­forms mea­sures, said it was not in­sist­ing on a cap on the tax rate in the 122nd Con­sti­tu­tion (Amend­ment) Bill, which par­lia­ment needs to rat­ify for the tax to take ef­fect.

The gov­ern­ment says no cap should be put be­cause ex­i­gen­cies might arise in fu­ture to re­vise the rates, which will re­quire par­lia­men­tary ap­proval ev­ery time.

“We are not echo­ing what the Congress is say­ing. We will be happy even if the gov­ern­ment gives an as­sur­ance on the floor of the House to keep the tax rate low,” CPI(M)’s polit­buro mem­ber and Lok Sabha leader Md. Salim told Hin­dus­tan Times.

Ear­lier this week, finance Min­is­ter Arun Jait­ley had sig­nalled that sup­port had broad­ened among states for what is seen by in­vestors as In­dia’s big­gest tax re­form in decades. The CPI-M’s views could now force the Congress, the orig­i­nal au­thor of the GST bill, to soften its stand.

The GST-linked bill has been ap­proved by the lower house of par­lia­ment, Lok Sabha, but the num­bers in the up­per house, Ra­jya Sabha, are stacked against the gov­ern­ment.

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