Amid concerns expressed by the ruling Shiv Sena and Opposition NCP, the Maharashtra legislature on Monday ratified the Goods and Services Tax (GST) Constitutional Amendment Bill passed by the Parliament early this months, thus becoming the tenth State legislature in the country to adopt the crucial legislation.
At a special one-day session, both the Houses of the State legislature adopted unanimously the CST Constitutional Amendment Bill, which had been passed by both the Houses of Parliament earlier this month.
In the 288-member Maharashtra Assembly where the BJP and Shiv Sena (SS) alliance has a majority of 185, the Opposition Congress and NCP joined forces with the treasury benches to pass the GST Bill unanimously. The bill was passed unanimously in the Upper House as well.
Apart from Maharashtra, nine States — Assam, Bihar, Jharkhand, Himachal Pradesh, Chhattisgarh, Gujarat, Madhya Pradesh, Delhi and Nagaland, have so far ratified the GST Bill. At least 16 State legislatures have to ratify the GST Bill, before it is sent for Presidential assent.
Tabling a resolution to ratify the GST bill, Maharashtra Finance Minister Sudhir Mungantiwar said the State government would not incur any losses because of the GST once the legislation is enacted. "Chief minister Devendra Fadnavis has spoken to Union Finance Minister Arun Jaitley in detail about the impact of GST on the State," he said.
Mungantiwar said that the ruling Shiv Sena, which had apprehensions about the GST bill, had been taken on board before tabling the resolution in the House. "We have spoken to the Shiv Sena and clarified matters with regard to the GST Bill," he said.
Allaying the fears expressed by the Shiv Sena whose MlA Sunil Prabhu had said in the State Assembly that the Brihanmumbai Municipal Corporation (BMC) would stand to lose around Rs 7,000 crore per year once GST became a reality, chief minister Fadnavis tweeted: "All Municipal Corporations will get their proper share of revenue including Mumbai and interest of local bodies will be protected";.
In a series of other tweets, Fadnavis said: "Autonomy of States will not be in danger due to GST. In fact it (GST) will lead to more integration between states as desired by our Constitution…Provision of compensation for 5 years, definition of consensus and parliamentary consultative process are some demands were included after we raised voice…There were some provisions which were opposed earlier, but in the process of consensus now we all would be on same page".
Fadnavis, who replied to a debate on the CST bill in the State legislative Council, also said that the Maharashtra government had prepared itself to implement the levy of GST from April 1, 2017. "Prime Minister Narendra Modiji had specifically insisted on IT preparedness before implementing GST Now we are ready to roll FST in the state".
"GST will definitely cut barriers and it will provide level playing field for all and it will also end tax evasion," the chief minister said.
Earlier, speaking on the GST bill in the Assembly, leader of the Opposition Radhakrishna Vikhe-Patil advised the GST against taking credit for bringing in the GST bill. "The GST bill is the Congress' offspring and the BJP should not claim parentage. It was Congress which bore the 'labour pain' (on GST bill)," Vikhe Patil said.
Recalling that the BJP had opposed the GST bill while in the Opposition and Narendra Modi had himself spoken fiercely against the bill when he was chief minister of Gujarat, Vikhe-Patil said: "While on one hand the BJP government always blames us for all the ills facing the country, on the other it implements many of the Congress' policies and programmes".
NCP's group leader and Maharashtra's former Finance Minister Jayant Patil expressed an apprehension that the State's fiscal autonomy might be eroded because of certain provisions in the GST Act. "The states which have so far been so far lagging behind Maharashtra on the development from will catch up with us as a result of the GST," Patil said.
Patil also apprehended that nearly 80 per cent middle class people will bear the brunt of inflation once the GST came into force. "We need to be on the alert, because there will be direct impact of GST on people from various walks of life, including those at the grassroots," he said.
Shiv Sena MlA Sunil Prabhu said that the BMC would stand to lose a staggering Rs 7,000 crore which it currently earned through the levy Octroi, once the GST came into force.
“The Centre has assured us compensation for the first five years. That's not enough. The Centre should compensate for at least 25 years so that BMC does not have to beg before the state and Central governments," Prabhu said.
"Owing to discontinuation of Octroi levy, We have to cut down on major development works in Mumbai. Similarly, we will not have much of revenue to fund health facilities for the 1.5 crore Mumbaikars," he said.
Prabhu said that since the BMC has long been registering a ten per cent annual growth in Octroi revenue every year, the Centre should make a provision for 10 per cent increase in the compensation to the BMC. "Similarly, the State government should make all efforts to ensure that Mumbai's financial autonomy is intact," the Sena legislator said.