NEW DELHI: The gap between Congress and the government over the GST bill might be narrowing. The main opposition has indicated that it might relax a key condition – the tax rate being written into the Constitution amendment – as long as there are firm legal commitments to a rate that Congress views as reasonable and viable.
Deputy leader of opposition in Rajya Sabha Anand Sharma suggested that Congress may not insist on inclusion of an 18% tax cap in the bill – one of three conditions the party has put forward and which has held up passage of the legislation for more than a year. Some months ago, Congress vice-president Rahul Gandhi had indicated that the differences essentially boiled down to the tax rate.
“But the government would have to suggest ways for legal ringfencing of the rate,” Sharma said, adding that the Centre has not opened a dialogue with them yet, without which there cannot be a resolution to the tricky obstacles.
Sharma’s upfront remark indicates a closer alignment between Congress and the Centre who have differed bitterly on a host of issues ahead of the monsoon session starting July 18.
According to observers, the change of heart in Congress may be a result of its weakening political clout after defeats in Assam and Kerala. There is apprehension in certain quarters that since most regional parties, including those in the anti-BJP axis, have extended support to the GST, continuing blockade could mean political isolation for Congress. There is also concern that the government accusations against Congress for “holding up” development is resonating with voters.
There have been differences within Congress on GST. Many involved in party discu- ssions felt an insistence on the inclusion of a tax cap in the co- nstitutional amendment bill would not be sustainable. “It was not part of the UPA bill,” a functionary said, though leaders like former finance minister P Chidambaram have defended the demand.
Congress seems caught in a dilemma on how to deal with the Modi regime rejuvenated by the change in political atmospherics after the last ro- und of polls. While an obstructionist attitude in Parliament may risk isolating allies who are in favour of GST, abruptly giving in on a long confrontation would show it as surrendering to “political reality”.