The reason for an intermediate date instead of April 1 is prompted by logistical concerns. The government is firm it will make GST happen from next year with all the constitutional bills being cleared in this fiscal.
A July date gives the government reason to feel satisfied that this promise has been met. It will also be one year from the Budget this year. Explaining the rationale, a source said in this there are five sets of bills which need to go through the two Houses of Parliament. Some of them will also need to run through the state legislatures. The government has effectively two sessions to complete the same, since, in the Budget session next year it will be difficult to do any work on the same.
But along with the bill, there is concurrent work going on to put the information technology superstructure in place. The finance ministry anticipates that along with the state governments, trade and industry needs to be taught how to run the system. If the date for the roll out is kept to April 1, 2015, the government will have no time to make changes in central tax rules bringing in the concerns of all sections on board as the time for pre-Budget consultations is limited.
Jaitleys team is keen to ensure that as the biggest piece of tax reform in the country, the GST framework should not throw up bad surprises. The July 1 date gives them room to work the glitches and the time to do so, beyond the din of the annual Budget.
Reforming indirect taxes
* The reason for an intermediate date instead of April 1 is prompted by logistical
* The government is firm it will make GST happen from next year with all the constitutional bills being cleared in this fiscal