The Goods and Services Tax (GST) Bill has crossed another milestone on Thursday with 50% of states and union territories (UTs) ratifying it, making it ready to be placed before President Pranab Mukherjee for approval.
Odisha became the sixteenth state to pass the GST Bill on Thursday, and completed the 50% requirement, much ahead of the schedule.
Soon after Assam ratified the GST Bill to become the first one to go, 15 other states including Maharashtra, Haryana, Bihar, Jharkhand, Himachal Pradesh, Chhattisgarh, Gujarat, Madhya Pradesh, Delhi, and Nagaland, followed suit and approved the Bill.
The government now faces the toughest job of fixing the GST rate. The state finance ministers have to agree on a GST rate, tax slabs and exempted goods and services, before supporting legislations go to Parliament in November. GST rate will have to be approved by the GST Council comprising the finance minister and representatives of all the 31 states and UTs.
While New Delhi has to draft the CGST (Central GST) and IGST (Integrated GST) laws, the states will have to come up with an SGST (State GST) law.
The government has set a deadline of April 1 to roll out the indirect tax regime, which is dubbed as the biggest tax reform in India.
GST will subsume most indirect taxes, like excise duty, service tax and VAT. Once rolled out, it will create a uniform market for seamless movement of goods and services with one tax rate.
“The requisite number of states has ratified the GST Constitution Amendment Bill and now it can go for Presidential assent,” Jaitley tweeted.
Revenue secretary Hasmukh Adhia also tweeted that the minimum requirement of 50% states ratifying the bill is complete with Odisha ratifying the Constitutional Amendment bill for GST.
“Glad to inform that we are ahead of our schedule for implementation of GST so far. Instead of 30 days kept for this, it is achieved in 23 days,” he said in another tweet.
The Constitutional Amendment Bill for GST was passed by Parliament on August 8.