West Bengal finance minister is relentlessly pressurizing the point that the demonetization effect will also cover the GST and its roll out in coming future. West Bengal finance minister Amit Mitra said that, “the timing is not right for its implementation, given the impact on state finances because of the partial demonetization, Demonetization of Rs 500 and Rs 1,000 currency notes, and the resulting turmoil, makes April 1, 2017, target date for a national goods and services tax (GST) unlikely.”
“The government needs to redo its arithmetic,” he told a news channel. And, that the Centre “should do GST at a time when it’s feasible…I don’t see that at this time, as a student of economics.” he added.
The Union finance minister, minister of state for finance, and state representatives, mostly finance ministers, are a piece of the Council. Presentation and entry of the Bills in the present session are important to guarantee GST to take off from April 1.
His supervisor, Bengal Cheif minister Mamata Banerjee had before requested rollback of the currency ban. The Union finance ministry has put the draft model GST and compensation Bill in the general population space. The legislature is demanding to present Central GST, integrated GST and compensation Bills in Parliament in the present session, in the wake of getting an endorsement from the GST Council, which would meet on Friday and Saturday.
Coming from the background of eager restriction by many states to demonetization, this might be viewed as a sort of political payback. Calling attention to that the administration’s choice to demonetise high currency notes have officially affected state accounts, Mitra said, “India’s federal structure may not be prepared for a ‘double whammy’ as the implementation of GST could further hurt state finances.”
Mitra is also the chairman of the empowered committee of state finance ministers said that “We must do GST but do it at a time when it is feasible, successful, when states’ revenues do not decline significantly, Centre is able to compensate the states and federal policy of India is preserved. I do not see that at this time.”
“We expected a huge destabilization of the fiscal architecture of the country with GST. State taxes will fall significantly, and that is why we sought that the center should compensate us for five years,” Mitra said. “We all supported GST under the premise that this would be the only destabilization factor. We did not know that there will be a much bigger destabilization in the form of demonetization that will be let loose on the country,” he added
Kerala finance minister Thomas Isaac also attached his voice in the same, when asked about the effects, “Yes. It has now opened up a whole lot of issues. The state’s revenues are suffering. I don’t want to be seen as opposing GST but there is a lot of merit in what he said. We will take a common stand through consideration.”
Mitra’s remarks come in front of the urgent GST gathering meeting on 2 and 3 December that is booked to talk about the draft GST laws and the bill on compensation. The council’s gesture to these bills will be urgent for table them in the winter session of Parliament.
PM Narendra Modi scratched off the legitimacy of the old Rs.500 and Rs.1,000 notes with impact from 9 November. The administration’s choice has been emphatically restricted by numerous resistance parties, including Mitra’s Trinamool Congress, the Congress party and the Communist gatherings.
Meanwhile, in the GST migration process, the information migration of the current VAT, ToT, and different merchants to the Goods and Services Tax Network (GST) database from the present backhanded assessment framework would be done in Telangana between January 1 (2017) to 15. The information relocation includes enrolment of the current citizen into the GST normal gateway subject to legitimate PAN. A state government release said that “The data migration in the country began in November.”