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GST a whisker away from reality, all four Bills passed in Lok Sabha

Jaitley aims to roll out new sales tax from July 1 that will subsume slew of federal, state levies

Agencies  |  New Delhi 

Lok Sabha passes all four GST Bills

The on Wednesday passed key legislations, putting Asia's third-largest economy on course to launch a nationwide goods and services (GST) from July.

Minister aims to roll out the new sales from July 1 that will subsume a slew of federal and state levies, transforming a nation of more than 1.2 billion population into a single market.

What calls the biggest reform since independence in 1947 is expected to boost economic growth by about 0.5 percentage points in its first year of implementation.

The four bills, passed by the Lok Sabha, would next be presented before the

Proposed range from 5 to 28 percent, with 12 percent and 18 percent being the standard It has not been decided yet which will apply to which categories of goods.

The Central Bill, 2017; The Integrated Bill, 2017; The (Compensation to States) Bill, 2017; and The Union Territory Bill, 2017 were passed after negation of a host of amendments moved by the parties. Replying to the seven-hour-long debate, Minister said the GST, which will usher in a uniform indirect regime in the country, will make commodities "slightly cheaper". He said the would depend upon whether the commodity is used by a rich person or a common man. said once the new regime is implemented, the harassment of businesses by different authorities will end and India will be one rate for one commodity throughout the country. He said the Council, comprising Ministers of Union and states, had agreed to take a decision on bringing real estate within the ambit of the new regime within a year of its rollout. On the impact of on prices, said: "Today you have on tax, you have cascading effect.

When all of that is removed, goods will become slightly cheaper". On why the Council has decided on multiple rates, said one rate would be "highly regressive" as "hawai chappal and BMW cannot be taxed at the same rate". He said currently food articles are not taxed and those will continue to be zero rated under the All other commodities would be fitted into the nearest bracket. The Council has recommended a four-tier structure — 5, 12, 18 and 28 per cent. On top of the highest slab, a will be imposed on luxury and demerit goods to compensate the states for revenue loss in the first five years of implementation. However, the Central (CGST) law has pegged the peak rate at 20 per cent and a similar rate has been prescribed in the State (SGST) law, which takes the peak rate to 40 per cent which will come into force only in financial exigencies. said the would be transient for a period of 5 years so that the proceeds can be utilised to compensate the states. Touted as the biggest taxation reform since Independence, will subsume central excise, service tax, VAT and other local levies to create an uniform market. is expected to boost GDP growth by about 2 per cent and check evasion.

First Published: Wed, March 29 2017. 21:37 IST