Odisha House approval paves the way for President’s nod for GST Bill

The Odisha Legislative Assembly on Thursday unanimously ratified the Constitution Amendment Bill for Goods and Services Tax (GST), paving the way for introduction of the landmark tax reform.

Chief Minister Naveen Patnaik moved the statutory resolution in this regard at a special one-day session of the Assembly that was supported by members of all political parties, barring the lone CPI(M) member, who did not participate in the discussion.

The Constitution (122nd Amendment) Bill, 2014 on GST was passed by Parliament recently and Odisha has become the 16th state to ratify it after Goa. Ratification of the Bill by at least half of the total States was mandated before it is sent for the President’s nod.

Not touching the controversial point of capping the tax limit as demanded by the Opposition Congress members, Mr. Patnaik said, “We will separately request the Government of India to consider the State’s concern for imposition of Green Tax on polluting goods in addition to GST. We will also request the Centre to take appropriate action for CST compensation to the States up to 2016-17 for reduction of CST from 4 per cent to 2 per cent.”

While supporting the resolution, Mr. Patnaik said a number of benefits were expected to accrue not only to the Central and State governments, but also to the consumers, business and industry from the change over to the GST system.

“The overall tax burden on most commodities is expected to come down. The government will get the benefit of higher revenue efficiency. Business and industry will find it easier to comply with,” he said, adding that the Constitutional Amendment for the GST marked the beginning of a journey.

“We have to establish the legal framework through enactment of the GST laws by the Centre and the States, put in place a robust information technology-based platform for administering the new tax, manage the change through training the tax administrators and officials, familiarise the members of trade and industry with the processes of the new taxation system and sensitise the public about its effect,” Mr. Patnaik said.

There are challenges before the State to roll out the GST next year, he said even as he appealed to all to work together to make the GST “happen”.

Leader of Opposition in the House Narasingha Mishra of the Congress said there should a capping system like 18 per cent to save the poor people from high taxation. “Ours is a poorest of the poor State. Therefore, the State government must bat for having the capping system,” He alleged that the ruling BJD had put forth contradictory views on the capping in the Rajya Sabha.

Mr. Mishra said that when the BJD’s leader in the Rajya sabha did not support capping on tax, that party’s another senior member wanted it. Mr. Mishra also quoted a BJD MP’s statement in the Rajya Sabha where he had said that Odisha will badly lose on revenue collection if the GST comes into force.

“‘If State will lose according to ‘the BJD MP, why such ratification?’ he asked. He demanded a clarification from the Chief Minister on the BJD’s view. He expressed displeasure at the State government’s ignorance on the GST Bill. “We want to know how much Odisha will benefit or lose,” Mr. Mishra asked.