Singh blames BJP for scuttling GST rollout

Written by Political Bureau | New Delhi | Updated: Feb 18 2011, 05:27am hrs
Prime Minister Manmohan Singh on Wednesday squarely blamed the Bhartiya Janata Party (BJP) for keeping a 'hostile attitude' towards the government and accused it particularly for delaying the introduction of a single goods and services tax (GST).

Stating that the GST will make India's tax system an envy of the world, the Prime Minister said the opposition-led states did not wish to cooperate over path-breaking reforms to usher in a single GST. The reasons that have been given, frankly I cannot mention it in public. They say because you have taken some decision against a particular person, who was a minister in Gujarat, we must reverse it. Singh, however, stopped short of naming the minister.

In fact, it was Yashwant Sinha as finance minister during the BJP-led National Democratic Alliance government in 2000, who kick-started indirect tax reforms and initiated a dialogue on value added tax by setting up the empowered committee of state finance ministers. Finally, VAT was implemented in 2005 and P Chidambaram, as finance minister in 2007-08 took the next step of announcing a transition to a single GST.

But the BJP-ruled states have stalled introduction of GST over the last couple of years. When the Parliament is not allowed to function, when the Opposition do not wish to cooperate with the path-breaking reforms of Goods and Services Tax (GST)... This is a reform which is needed, Singh said at an interaction with television editors.

The PM's comments come just days after BJP-ruled states opposed the latest draft on Constitutional amendment required for introducing GST. This was the Centre's third attempt to appease concerns of states on issues like fiscal autonomy and dispute settlement. At the meeting with the Empowered Committee of state finance ministers, FMPranab Mukherjee sought their support for tabling the amendment in Parliament.