Congress green signal for GST Bill might be tabled in RS next week

The discussions have entered a 'decisive and positive phase', Congress sources said.

New Delhi: Government’s fervent efforts to pass the Goods and Services Tax (GST) Bill might finally be bearing fruit, with sources close to the Congress Vice President Rahul Gandhi revealing that 'some progress was made in the negotiations’ regarding the bill.

According to reports, the bill might be tabled in Rajya Sabha early next week, on Monday or Tuesday.

The development comes a day after the cabinet cleared key changes in the Constitutional Amendment Bill on the GST Bill, which was one of the three conditions put forward by the Congress to ensure its support for the bill.

The Cabinet on Wednesday approved the changes to the Constitutional Amendment Bill that was approved by the Lok Sabha in May last year. Once the Rajya Sabha approves the legislation, the amended Bill will have to go back to the Lok Sabha again for approval.

The amendments were taken up by the Cabinet after Finance Minister Arun Jaitley's assurance to state finance ministers to include in the Bill the mechanism of compensating states for all the loss of revenue for five years.

With states on board and the Cabinet approving the amendments, the government is hopeful of passage of the long-pending GST Bill in the ongoing monsoon session of Parliament, which ends on August 12.

The Bill, in its present form, provides that the Centre will give 100 per cent compensation to states for first three years, 75 per cent and 50 per cent for the next two years.

However, the Select Committee of the Rajya Sabha had in its report recommended 100 per cent compensation for probable loss of revenue for five years.

As per the amendments, the Centre will now constitutionally guarantee states any loss of revenue from the GST subsuming all indirect taxes, including VAT, in the first five years of introduction.

By doing away with the 1 per cent inter-state tax over and above the GST rate, the government has met one of the three key demands over which Congress has been blocking the Bill in the Upper House.

The other demands of including GST rate in the statute and a Supreme Court judge-headed dispute resolution body has not been accepted. It remains to be seen if meeting of its demands halfway will persuade the Congress to support the legislation.

There is a talk of mentioning the GST rate in one of the two supporting legislations that need to be passed after the Constitution is amended, a move that may pacify the Congress.

Finance Minister Arun Jaitley and Chief Economic Adviser Arvind Subramanyam reportedly held two rounds of discussions with Congress leaders, in addition to extensive talks with other parties including Samajwadi Party, JD(U) and CPI(M).

"Serious effort is being made to bring a consensus on the GST bill," Congress leader Anand Sharma said without disclosing details on whether the Congress was insisting on its standing about putting a cap on the levy in the Constitution bill.

Congress sources said party Rahul Gandhi also expects a positive outcome from these consultations. They said the discussions have entered a "decisive and positive phase".

"Talks are on with various parties on GST and so far things are moving forward as expected," a senior government functionary said adding the effort is on to present it in the Rajya Sabha next week.

Sources also revealed Jaitley told the opposition leaders that government wants to bring consensus on the GST and was ready for talks with any leader even during the weekend to hear out and address their concerns on the issue.

A top congress leader, however, said they were awaiting the draft of the legislation after "extensive talks" with the government and hoped for a "positive outcome".

Sources add that the government is also in touch with AIADMK chief J Jayalalithaa on the key bill.