Arun Jaitley introduces 4 supportive bills on GST in Parliament
Indian Union Finance Minister Arun Jaitley on monday, March 27th, 2017 introduced four bills on Goods and Services Tax (GST) in the lokh sabha, lower house of the parliament. This is the biggest step taken on the system of taxation after the independence in 1947. This major reform is going to be introduced as the Constitution (101st Amendment)Act 2016.
The four bills introduced by the finance minister include, the CGST, the IGST, the UGST and the SGST bills. These bills implemented result in One market with One rate of tax instead of multiple state and central taxes.
Prior to this the four bills need to be cleared by Union cabinet ministers and GST council, which was done.
The bill is initially introduced in the August of 2016 in Rajya Sabha. The Rajya Sabha cleared the bill that amended the constitution to enable India’s biggest tax reform, GST.
This new tax is expected to be implemented from july 1st, 2017, almost after 70 years of Independence.
This system is going to lead to the increase rate of economic growth.
The four supportive bills are
CGST- Central Goods and Services tax:
This bill replaces all the taxes incurred by central government in the form of sales tax, excise duty, additional customs duty, surcharges and cesses.
The maximum tax of 20 percent is provided by CGST.
IGST- Integrated Goods and Services tax:
This is collected by the central government on inter-state supply of goods and services. This law provides maximum of 40% tax.
UGST- Union Territory Goods and Services tax:
All the taxation according to GST in Union territories (Chandigarh, Andaman and Nicobar Islands, Lakshadweep Islands, Dadra & Nagar Haveli and Daman & Diu) is handled.
SGST- State-Goods and Services tax:
This is the GST bill to be passed in all the state legislatives.
As approved by GST council, actual rates in four tier tax structure are 5, 12, 18, 28 % and in financial emergencies, there is a provision of 40% peak rate . This 40% is the combined rate of central and the equal amounts by the states