Crucial GST Bill can pass in 2016: Top 5 points of relief for Narendra Modi
Crucial GST Bill can pass in 2016: Top 5 points of relief for Narendra Modi: Even as chances of the GST Bill being passed by Rajya Sabha in current Budget session of Parliament are slim, the Narendra Modi government may well get a big boost and see this crucial legislation cleared in 2016 itself.
Even as chances of the GST Bill being passed by Rajya Sabha in current Budget session of Parliament are slim, the Narendra Modi government may well get a big boost and see this crucial legislation cleared in 2016 itself. It is a tough task, but the numbers can get favourable. Here is how this can become a big achievement for Narendra Modi and the Bharatiya Janata Party (BJP) and it may well signal a huge setback for Rahul Gandhi's Congress, which wants govt to include certain points before it allows it to be cleared. In effect, Modi govt won't need the Congress support at all: (Image Source: PTI)
1. The Narendra Modi government is likely to gain the votes it needs to pass the Goods and Services Tax (GST) bill in 2016, which could have far reaching macroeconomic and earnings implications, says a Morgan Stanley report. “The government could gain the votes it needs in 2016 to pass a Goods and Services Tax (GST) bill,” Morgan Stanley said in a research note. (Image Source: PTI)
2. In recent times, investor expectations regarding the passage of the GST Bill, have waned due to a logjam in the Upper House. However, according to the global financial services major, support for GST bill is rising in the Rajya Sabha. “The key to the bill’s passage is a reduction in the number of Upper House members opposing the bill. That number currently stands at 91 and it needs to fall to 82 for the bill to clear – we forecast that to happen by July 2016,” the report noted. (Image Source: PTI)
3. The report further noted that “once the bill clears Parliament, getting the bill passed by more than half of the states should not prove challenging, as the BJP and its allies are currently in power in 12 of 29 states, and a few beyond the 12 are supportive of the bill”. (Image Source: PTI)
4. The GST bill will have significant implications for the stock market – the volatile nature of the Sensex has seen this crucial index crash repeatedly to levels seen during the UPA govt's last days. As per the research report, 6 of the 10 sectors would benefit from a GST implementation. Sectors like consumption, logistics, house building materials, and industrial manufacturing would likely experience a positive impact. (Image Source: PTI)
5. Meanwhile, cigarettes (if included in the GST) and oil & gas could see a negative impact, while the remaining sectors would likely see a neutral impact, the report noted. Finance Minister Arun Jaitley recently said that the government will reach out to the Congress in the current session of Parliament to resolve the deadlock over the GST bill. Jaitley had said the proposed Goods and Services Tax (GST) is the need of the hour and it has the capability to strengthen the Indian economy. (Image Source: PTI)