Finance minister Arun Jaitley will meet his counterparts from state governments and union territories with assemblies on Wednesday to shore up political support for amendment to the constitution for implementing the goods and services tax.
The finance minister is likely to ask the state finance ministers to lobby within their parties to support the constitution bill in Parliament, officials said. Most state governments have already been brought on board for introduction of GST after the centre agreed to compensate them for any loss in revenue after the new tax is introduced.
Congress spokesperson Randeep Singh Surjewala said the Congress parliamentary party will take a call on supporting the constitution amendment bill. Mallikarjun Kharge, who is the leader of the Congress party in Lok Sabha, could not be reached for comment.
The government proposes to get the bill to amend the constitution passed in the ongoing session of Parliament that ends on May 8 so that the process could be completed for rollout of GST by April next year.
The reach out to other major political parties is necessary as an amendment to the constitution requires support of at least two-thirds of members of both houses in Parliament.
In Lok Sabha, the bill will need support of 358 members, while in Rajya Sabha 162 votes will be needed to pass it. The NDA government is falling short of numbers even in Lok Sabha by 20. In Rajya Sabha it falls short of numbers by a huge margin.
While the opposition may be adamant on the allowing changes in the land acquisition bill, all parties appear on board on the constitution bill on GST.
“If the bill gets debated it will be passed. Even the chairman of the empowered group of state finance ministers who is from the opposition has spoken in favour of the bill,” tax partner at EY Bipin Sapra said.
The chairman of the committee is KM Mani who is also the finance minister of Kerala, a state ruled by the Congress.
After Parliament gives its approval to the bill, the changes will have to be ratified by at least 50 per cent of the state assemblies. NDA allies run governments in 13 states.
Once the Constitution is amended, the centre will prepare a model draft of GST Act with the help empowered committee of states and based on that states will form their own acts.
The goods and services tax will replace indirect taxes levied by the centre and states. The central taxes that will form part of GST include excise and service taxes. State taxes that will be part of the GST include value added tax, luxury tax, octroi and entry tax.The amendment bill will give the centre and state governments concurrent powers to make laws on the taxation of goods and services.But only the centre may levy and collect GST on supplies in the course of interstate trade.