One hot topic discussed these days in the corridors of Lutyen’s bungalows as well as Lalaji ki chai ki dukaan is a new shiny three letter acronym in the Indian financial discourse: GST. This acronym heralds many changes, promises new beginnings and assures a more transparent way of collecting the taxes.
The government – headed by Prime Minister Narendra Modi, and Arun Jaitley heading the Finance Ministry – is marshalling all its wherewithal to push through the myriad mazes of Indian political establishment as well as tackle the bureaucratic quagmire to get a semblance of a uniform code for taxation across the country, respecting the federal disparities and at the same time keeping similar structures across all states and union territories.
And like all major reforms, and all incumbent governments – the discussion about GST spans political, financial, social, academic and personal domains and takes form of propaganda, conspiracy theories, old-wives tales as well as Whatsapp-forwarded wisdoms.
So, in this post today, we’ll try to have an objective view of the actual timeline of events leading towards the GST implementation in India, and also will try to debunk theories like BJP is behind the reforms that Congress government can never bring about, and BJP was actually blocking GST all the time so that Congress does not take any credit for it.
Because, timelines and actual event dates are sometimes the only way to keep newsroom, drawing room, dukaan, and whatsapp discussions sane and to the point, and not turn into a cacophony of opinions.
- 2000 – Atal Bihari Vajpayee – sets up a committee
- 2004 – A task force chaired by Vijay L. Kelkar, then advisor to the finance ministry, says the existing tax system suffers from many problems. It suggests a comprehensive GST.
- February 2005 – P Chidambaram – budget speech for financial year 2005-06 (Full Letter- Budget)
- February 2006 – Palaniappan Chidambaram – sets April 1, 2010, as the date for introducing the GST
- November 2006 – P Chidambaram – various reform measures
- February 2007: The union budget for 2007-08 retains the April 1, 2010 deadline for implementation of the GST
- February 2008: finance minister Chidambaram says – (Full Letter – Budget)
- July 2009 – India’s new finance minister, Pranab Mukherjee (Full Letter – Budget)
- November 2009: The committee under Asim Dasgupta releases its first discussion paper on the GST in the public domain –
- February 2010: launches a mission-mode project (Full Letter – Budget)
- March 2011 – The Congress party-led government introduces a constitution amendment bill
- June 2012: – The standing committee begins discussion. India’s opposition parties, including the BJP and the Left — URL is missing
- November 2012: Finance minister Chidambaram holds meetings with state finance ministers.
- February 2013: In his budget speech, Chidambaram announces
- August 2013: The standing committee submits its report
- October 2013: The Narendra Modi-ruled state of Gujarat opposes the bill
- May 2014: The constitution amendment bill lapses with the dissolution of the 15th Lok Sabha. The same month, the BJP, led by Narendra Modi, is voted into power.
- February 2015: In his budget speech, Jaitley announces that the government is keen on implementing –
- May 2015: The Lok Sabha passes the constitution amendment bill to GST. –
- August 2015: The government is unable to push the bill in the Rajya Sabha
- March 2016: Jaitley says he agrees with the Congress’s demand that the GST rate must not be above 18%
- August 2016: The Congress seems to finally agree with the Modi government
- March 2017: Four Bills related to the Goods and Services Tax or GST, debated in the Lok Sabha
- March 2017: All four bills related to GST was on Wednesday passed in Lok Sabha with voice votes.
- April 2017 : Rajya Sabha passes all four GST Bills with Manmohan Singh’s help
Congress and BJP on GST – Past News
- Congress’ Gift To The Wealthy, A GST Tax “Holiday” In 2010 — Act Before The New Year!
The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, P.L. 111-312 (2010 Tax Act), which President Obama signed into law on December 17, 2010, made significant changes to wealth transfer taxes.Of special importance is a generation-skipping transfer tax loophole that Congress is allowing, but only for the remaining days in 2010. Click to read more
- BJP-ruled states oppose implementation of GST
Some BJP-ruled states expressed doubts over the implementation of goods and services tax (GST) from April as they are strongly opposed to the provision in the draft constitutional amendment bill that gives the Centre a veto power on the states’ taxation issues. Click to read more
- Government wants a single tax slab under GST
The Union government wants a single tax slab under the proposed goods and services tax (GST) regime, according to a paper published on the finance ministry’s website on Monday. It also wants alcohol, petroleum, natural gas and electricity to be brought into its tax base. The ministry’s paper contains a list of comments on the proposals unveiled by the states in their November blueprint. Click to read more
- Finance Minister P Chidambaram’s Budget speech
In November 2006, the UPA Government crossed the midpoint of its term of office. A midterm report card can now be presented. There are many pluses and a few minuses, and I shall deal with both candidly. The biggest plus is that the growth rate of GDP has improved from 7.5 per cent in 2004-05 to 9 per cent (Quick Estimate) in 2005-06 and, according to Advance Estimate, to 9.2 per cent in 2006-07. The average growth rate in the three years of the UPA Government is, therefore, 8.6 per cent. Thanks to this impressive performance, despite the poor start in 2002-03, the growth target set for the Tenth Plan of 8 per cent will be nearly achieved. Click to read more
- BJP continues opposing govt’s GST compromise proposal
The roll out of Goods and Services Tax from the scheduled date of April 1, 2011 has hit a political roadblock, as BJP-ruled states along with some others continue to oppose the draft of constitutional amendment bill. DMK-ruled Tamil Nadu and BSP- administered Uttar Pradesh also opposed the draft. Click to read more
- States express reservation over GST
The prospects of the proposed roll-out of the Goods and Services Tax (GST) from April 1, 2011 on Saturday appeared remote with the Chief Ministers of various States expressing misgivings on the mode of implementation of the new indirect tax regime, despite the Centre’s assurances to allay their apprehensions. Click to read more
- The gist of GST
India is preparing for a big change in the regime of domestic indirect taxes through the introduction of a Goods and Services Tax. This regime shift is expected to replace a plethora of taxes for the Central government and all the state governments. Therefore it is only to be expected that every agent in the economy governments, planners and policy makers ,average taxpayers as well as academics, would have their own take on the dream model for this tax. Click to read more
- The interesting story behind how GST evolved
It is India’s most radical tax reform. The Goods & Service Tax (GST), expected to be launched next year, will replace around 16 taxes, including central excise and service tax as well as state levies like value-added tax (VAT), stamp duty and entry tax. It has the potential to increase the country’s GDP by $500 billion and exports by up to 15 per cent. Click to read more
Reference and Further reading: https://qz.com/478650/indias-16-year-wait-for-the-mother-of-all-tax-reforms-the-goods-and-services-tax/