Panel of state finance ministers to appoint new chairman after Rather poll defeat

The empowered committee of state finance ministers will have to appoint a new chairman, as incumbent Abdul Rahim Rather, finance minister of Jammu & Kashmir (J&K), has lost the J&K Assembly elections from the Charar-e-Sharief constituency, ending his 37-year stint in the legislature.

Born in Badipora village of Chadoora, Rather (59) was first elected to the J&K Assembly in 1977. Rather’s loss comes when the committee has to placate states such as West Bengal and Tamil Nadu, are opposing the existing constitutional amendment Bill on a goods and services tax (GST). These states have also alleged they weren’t consulted before the Bill was introduced in Parliament.

Rather’s party, the National Conference, bagged 15 seats, lower than the People’s Democratic Party (28) and the Bharatiya Janata Party (25).

When contacted, a source in the empowered committee of state finance ministers said in case of a vacancy, all state finance ministers would meet to appoint a new chairman. “Currently, there is no vacancy,” he added.

The committee was set up by the Atal Bihari-led National Democratic Alliance government in 2000. It was mandated with facilitating states to switch from sales tax to value-added tax (VAT). On April 1, 2005, state-level VAT replaced sales tax in a number of states; some, such as Uttar Pradesh and Tamil Nadu, joined later. Subsequently, the committee was mandated with facilitating states to switch to a GST, in consultation with the Centre.

The Left’s Asim Dasgupta was the committee’s chairman since its inception till 2011. He was followed by the BJP’s Sushil Kumar Modi and, subsequently, Rather. Under Rather’s chairmanship, Union Finance Minister Arun Jaitley was able to broker an agreement with states on GST, before tabling a constitutional amendment Bill in this regard in Parliament.

Meanwhile, a senior Union finance ministry official said, “The Union finance minister will meet state finance ministers on December 26 and is likely to stress the need to harmonise economic policies, as mutual coordination in federal structure is important for creating a conducive environment for growth.”

Jaitley is scheduled to present his first full Union Budget in February, next year.