The long pending Goods and Services Tax Bill (GST Bill) was passed in the Rajya Sabha on Wednesday. The Constitutional Amendment Bill will help ensure uniform tax rates across states for various goods and services.
State finance ministers will come to an agreement on the rates on various goods and services that will be citizen friendly while also ensuring no revenue losses to the states. The Centre will also levy and collect the Integrated Goods and Services Tax (IGST) on all inter-State supply of goods and services.
The IGST mechanism has been designed to ensure seamless flow of input tax credit from one state to another. The GST will be divided into the CGST and SGST for the Centre and states, respectively.
Headed by Chief Economic Adviser Arvind Subramanian, a panel has recommended a revenue-neutral rate of 15-15.5% while a standard rate of 17-18% would be levied on most goods and all services.
The business and banking fraternity responded with enthusiasm to the GST Bill on social media. Yes Bank CEO Rana Kapoor tweeted that ‘GST Bill will usher a virtuous growth cycle in India for several decades up to 2050’, while Amitabh Kant, Niti Aayog CEO remarked on his Twitter handle, ‘One Nation One common market will give a huge boost 2 productivity, efficiency & ease of doing business. Now execution is key.’