GST Constitutional Amendment Bill: Cabinet approves changes

By: | Updated: July 28, 2016 2:09 PM

The Cabinet approved changes to the GST Constitutional Amendment Bill that provides full compensation to states for initial five years after the implementation of the new indirect tax regime.

The Cabinet approved changes to the GST Constitutional Amendment Bill that provides full compensation to states for initial five years after the implementation of the new indirect tax regime. (PTI)The Cabinet approved changes to the GST Constitutional Amendment Bill that provides full compensation to states for initial five years after the implementation of the new indirect tax regime. (PTI)

The Cabinet approved changes to the GST Constitutional Amendment Bill that provides full compensation to states for initial five years after the implementation of the new indirect tax regime. Finance Minister Arun Jaitley had earlier agreed to include state compensation for all revenue losses for five years in the Bill.

The GST bill will give full compensation to states for the first three years and 75 per cent and 50 per cent for the next two years respectively. The government is planning to roll out the GST bill by April 1, 2017.

The GST was supposed to be implemented from April 1, 2016 but for strong opposition from the Congress party.

The Bill has already been passed by the lower house of Parliament and awaits the passage from the Upper House.

According to Nomura, the expected timeline for the passage of GST is by August 12 and there is a 60 per cent probability for this.

WATCH: GST Constitutional Amendment Bill: Cabinet approves changes

“We believe a compromise can be reached on the 18 per cent GST cap demand if the Congress either agrees to include the tax rate cap in the central government’s GST bill (instead of the constitution) or if the Congress agrees to a much higher tax rate cap,” Nomura said.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Switch to Hindi Edition