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Politicking begins at GST Council

By IndianMandarins- 31 Dec 2018
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Political dynamics at the GST council has changed. Following its victory in three states of Chattisgarh, MP, and Rajasthan, Congress has opted for engaging the BJP on GST issue.

 

For instance, the meeting of December 22 saw some Congress state ministers opposing cuts in tax rates of some products to 18% from 28%.

This provoked representatives of BJP-ruled states to demand that Congress' opposition be recorded in the minutes of the council as it contradicted the Congress party's public demand that all goods be taxed at 18%.

 

Congress state government representatives, on the other hand, objected to Prime Minister Narendra Modi making an announcement with respect to reducing the number of items in the 28% slab ahead of the meeting of the council, the apex decision-making body for GST.

 

The council had thus far managed to keep politics out of its deliberations, with most issues getting decided by consensus. This situation may not last any longer.

 

Already, in a letter to Union finance minister Arun Jaitley, Punjab finance minister Manpreet Badal has sought the inclusion of electricity, real estate and petroleum products under GST. "We may also have a look at the entire gamut of tax rates and exemptions so that a long-term blueprint is available for our forward path," he said.

 

He has also sought reconstitution of the law review committee, in view of the upcoming general election, to look at the entire law holistically. "We should avoid the temptation of another knee-jerk reaction and work towards making our GST truly world-class," said Badal. 

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