The Delhi Assembly on Wednesday ratified Goods and Service Tax (GST) Constitution Amendment Bill through resolution, becoming the third non-BJP-ruled State and overall the eighth to clear the proposed tax regime, billed as single biggest tax reform in decades. The resolution on GST was endorsed by the House by a voice vote following a brief discussion during which Deputy Chief Minister Manish Sisodia called GST a “big reform” which will be good for the country’s economy and growth.
“We support it. We support tax reform. Delhi is a service State and it (the Bill) is quite useful. The Bill should be passed but there are certain things to worry about. We need to keep certain things in mind,” Sisodia said in reply to a debate on the resolution in the Delhi Assembly. Implementation of GST will increase the Delhi Government’s share in central taxes. “That this House ratifies the amendments to the Constitution of India falling within the purview of clause (b) of the proviso to clause (2) of Article 368, proposed to be made by the Constitution (122 amendment) Bill 2014 as passed by both the Houses of Parliament,” the resolution said.
The two BJP MlAs were not present when the resolution Bill was passed in the House as they had staged a walkout over a separate issue, while another party MlA was serving suspension from the House for allegedly making derogatory remarks against an AAP legislator.
Delhi’s share in central taxes has been stagnant at `325 crore for the last 17 years and rolling out of GST is expected to increase its share in central taxes significantly. “It’s good for the entire country, not only for Delhi. It will be extremely helpful in terms of services. For the last 17 years, Delhi has been getting `325 crore as its share of Central taxes despite contributing as much as `1,37,000 crore to the country’s GDP. GST is a big reform,” said Sisodia.
The AAP Government has been supporting the Centre on the GST even though both sides are locked in a bitter tussle over a range of issues for the last one-and-half years. Speaking during the brief discussion on GST, a number of AAP MlAs hailed the proposed tax regime. later the Deputy Chief Minister took a jibe at the Centre saying it has for the first time recognised the national Capital as a “State”. “GST Bill for the first time recognises Delhi as a State under the new Constitutional amendment to Art 366 - step in right direction finally,” he tweeted. Sisodia said Union Finance Minister Arun Jaitley had written to Chief Minister Arvind Kejriwal on the GST issue on August 11. The letter stated, “GST seeks to subsume many direct taxes at Central and State level. GST will simplify and harmonise the indirect tax regime.”
In his remarks, Sisodia said there were some concerns over capping the annual turnover. “There is no clarity on certain issues. like businessmen in the Capital with a turnover of up to `20 lakh do not have to pay taxes. It should not be brought down,” said the Deputy Chief Minister.
The 122nd Constitution Amendment Bill has already been ratified by Bihar, Jharkhand, Chhattisgarh, Himachal Pradesh, Assam, Gujarat and Madhya Pradesh. Delhi is the third non-NDA State after Bihar and Himachal Pradesh to ratify the Bill.
The GST, seen as single biggest tax reform in a long time, needs to be ratified by at least 15 State legislatures before the President can notify the GST council which will decide the new tax rate and other issues. The Rajya Sabha had passed the GST Bill on August 4 while the lok Sabha cleared it on August 9.