GST: PM Modi satisfied with readiness for July 1 implementation

However, seven states yet to pass the needed legislation

Nearly sealing the goods and services tax (GST) implementation from July 1, Prime Minister Narendra Modi reviewed the preparedness, asking that high attention be given to cyber security in the enabling information technology (IT) systems.

The main problem now is that seven states -- the other 22 have done it -- are yet to pass their respective state GST legislations, with less than a month for the scheduled date of the tax's introduction. These are West Bengal, Meghalaya, Punjab, Tamil Nadu, Kerala, Karnataka, Jammu & Kashmir and West Bengal. All, except J&K, are ruled by opposition parties.

J&K also has a different dispensation. Its legislative assembly will have to also pass a Bill stating that both the Central GST and Integrated GST applies there. And, pass its own state GST, like the others.

Statutorily, if GST is not introduced by a state as of September 16, it will not be able to impose indirect taxes.

The PM took the meeting amid the stiff opposition raised by West Bengal over the IT preparedness for rollout next month. Bengal finance minister Amit Mitra has sought deferment of GST by two months, to September 1.

Modi took a meeting for two and a half hours. Various aspects of implementation were presented and reviewed -- IT readiness, personnel readiness, training and sensitisation of officers, query handling mechanisms and monitoring. Finance Minister Arun Jaitley, the cabinet secretary and other senior officials were present.

"The PM was informed that GST systems such as IT infrastructure, training of officials, integration with banks and enrolment of existing taxpayers will be in readiness well in time for the July 1 implementation date," went a statement from the prime minister's office.

Information security systems were discussed in detail during Monday's meeting. Bengal's Mitra had raised this point last Saturday, at the GST Council. He had argued that the GST Network (GSTN), the IT backbone, was not ready for July 1. "One of the world's biggest cyber attacks took place last month, gripping all large companies and countries. Is GSTN firewalled against it?" he'd questioned.

GSTN gave a presentation of its preparedness in the latest Council meeting. On Mitra's concerns, Jaitley had said then, "Others in the meeting did not share these views."

Describing GST as a turning point for the economy, Modi said creation of 'One nation, One market, One tax' would greatly benefit the common man.

The next GST Council meeting is scheduled for the coming Sunday. It is to take up the remaining issues -- the anti-profiteering body, e-way Bill, review of rates for some commodities on sectoral demand. The Council has fixed rates for almost all goods and services and finalised almost all the rules.

All items have been fixed in four broad categories of rates -- five, 12, 18 and 28 per cent, except for gold and precious metals, which will attract three per cent, and rough diamonds at 0.25 per cent. Around 19 per cent of all goods will attract a GST above 18 per cent.