GST Council meet inconclusive; April 1 target seems undoable

We do not have discretion of time. By Sep 16, 2017, curtains will draw on old taxation rule: FM

With the Centre and states again failing today to sort out contentious issue of dual control of assessees, the Goods and Services Tax (GST) rollout from April 1 next year is now looking virtually impossible.

The 6th meeting of the all-powerful GST Council was slated to decide on dual control of assesses but the two-day meeting was curtailed to half and even today that issue couldn't be discussed because all the time was lost in going clause by clause of the voluminous draft legislations.

While Finance Minister Arun Jaitley did not categorically say that the April 1 target date would be missed, states like Kerala and Tamil Nadu said that meeting the deadline was not possible and GST could be rolled out from September.

"In the draft legislation, there are about 195 sections. So it is the core bill of the legislation. We discussed 99 sections and a few clauses need to be redrafted. We would change that during the course of time. Hopefully, in the next meeting we would be able to clear the legislation part," Jaitley said.

The next meeting of the GST Council is scheduled for December 22-23.

Kerala FM Thomas Isaac said demonetisation has eroded states trust. "April 1 deadline is out of the picture, GST can be rolled out only by September".

Tamil Nadu also said that April 1 target was not possible.

"Too many sections of law yet to be finalised, GST can't happen without consensus on dual control," Tamil Nadu Finance Minister said after the meeting.

Jaitley, however, said that Centre stands by April 1, 2017, the target of implementing the GST.

"We do not have the discretion of time. By September 16, 2017, the curtains will draw on the old taxation rules," Jaitley said.

With the discussion on model laws and dual control still remaining, the GST legislations — CGST, IGST and compensation law — would not be introduced in the ongoing session of Parliament which ends on December 16.

Asked if the delay would derail the process, Jaitley said this time the Budget session will begin from January.

A finance ministry official said that most states too have their Assembly sessions in January and once the Council clears it, the passage of the GST legislations in Parliament and state Assemblies would just be procedural.

Today's GST Council meeting had a detailed deliberation on the several provisions of the draft model laws, including that of arrest provisions.

This is the second meeting in a row when the Centre and states discussed the model GST laws.

Based on this model law, the Central GST and State GST laws will be formed.

The discussion on the Integrated GST (IGST) law is likely to happen in the next meeting of the Council along with that of deciding on the jurisdiction over assessees.

"Hopefully, in the next meeting, we would be able to clear the legislation part. We will take up legislation and possibly the cross empowerment issue if time permits," Jaitley said.

Puducherry Chief Minister V Narayansamy said the Finance Minister is trying for a consensus. "We want a fair play on dual control".

Delhi FM Manish Sisodia said GST related issues not finalised yet.