History Goods and Services Tax (India)

the reform process of india s indirect tax regime started in 1986 vishwanath pratap singh, finance minister in rajiv gandhi’s government, introduction of modified value added tax (modvat). subsequently, manmohan singh,and finance minister p v narasimha rao, initiated discussions on value added tax @ state level. single common goods , services tax (gst) proposed , given go-ahead in 1999 during meeting between prime minister atal bihari vajpayee , economic advisory panel, included 3 former rbi governors ig patel, bimal jalan , c rangarajan. vajpayee set committee headed finance minister of west bengal, asim dasgupta design gst model.

the ravi dasgupta committee tasked putting in place back-end technology , logistics (later came known gst network, or gstn, in 2017) rolling out uniform taxation regime in country. in 2002, vajpayee government formed task force under vijay kelkar recommend tax reforms. in 2005, kelkar committee recommended rolling out gst suggested 12th finance commission.

after fall of bjp-led nda government in 2004, , election of congress-led upa government, new finance minister p chidambaram in february 2006 continued work on same , proposed gst rollout 1 april 2010. in 2010, trinamool congress routing cpi(m) out of power in west bengal, asim dasgupta resigned head of gst committee. dasgupta admitted in interview 80% of task had been done.

in 2014, nda government elected power, time under leadership of narendra modi. consequential dissolution of 15th lok sabha, gst bill – approved standing committee reintroduction – lapsed. 7 months after formation of modi government, new finance minister arun jaitley introduced gst bill in lok sabha, bjp had majority. in february 2015, jaitley set deadline of 1 april 2017 implement gst. in may 2016, lok sabha passed constitution amendment bill, paving way gst. however, opposition, led congress, demanded gst bill again sent select committee of rajya sabha due disagreements on several statements in bill relating taxation. in august 2016, amendment bill passed. on next 15 20 days, 18 states ratified gst bill , president pranab mukherjee gave assent it.

a 22-members select committee formed proposed gst laws. state , union territory gst laws passed states , union territories of india except jammu & kashmir, paving way smooth rollout of tax 1 july 2017. jammu , kashmir state legislature passed gst act on 7 july 2017, thereby ensuring entire nation brought under unified indirect taxation system. there no gst on sale , purchase of securities. continues governed securities transaction tax (stt).

launch

the goods , services tax launched @ midnight on 1 july 2017 president of india, pranab mukherjee, , prime minister of india, narendra modi. launch marked historic midnight (30 june – 1 july) session of both houses of parliament convened @ central hall of parliament. though session attended high-profile guests business , entertainment industry including ratan tata, boycotted opposition due predicted problems bound lead middle , lower class indians. 1 of few midnight sessions have been held parliament - others being declaration of india s independence on 15 august 1947, , silver , golden jubilees of occasion.

members of congress boycotted gst launch altogether. joined members of trinamool congress, communist parties of india , dmk. parties reported found virtually no difference between gst , existing taxation system, claiming government trying merely rebrand current taxation system. argued gst increase existing rates on common daily goods while reducing rates on luxury items, , affect many indians adversely, middle, lower middle , poorer classes.