GST Council Meet Inconclusive; April 1 Target Seems Undoable

New Delhi: The Goods and Services Tax (GST) Council - headed by union Finance Minister Arun Jaitley and which has as members finance ministers of all states - met for four hours on Sunday, but failed to sort out the contentious issue of dual control of assessees. With only three working days left in the current winter session of parliament, the government's mega tax reform GST now faces a real threat of being delayed beyond the roll-out deadline of April 1, 2017.

The next meeting has been fixed for December 22 and 23. Most of Sunday's meeting, the council's sixth, was taken up by discussions on the GST-related draft legislations -- Central GST, Inetr-state GST and the Compensation Law -- that need to be passed by parliament before the one tax for a unified market is implemented. After the winter session ends this week, parliament will meet next for the Budget session in January.

Finance Minister Arun Jaitley said after the meeting that the centre still hopes for an April launch. "The Budget session starts in January," said Mr Jaitley. "We do not have the luxury of time to have any discretion. By September 16, 2017 the curtains will draw on the old taxation rules," he added.

But several states did not share his optimism. Kerala's Finance Minister Thomas Isaac told reporters that states are not looking at the April 1 deadline but the Constitutional deadline. "We are not looking at April 1. That's out of the picture now but GST will be implemented by September next year," he said.

The Constitutional amendment bill, passed by parliament earlier this year to replace existing indirect taxes with the new GST law, was notified on September 16 this year and the new indirect tax regime has to be in place within 12 months of that date.

Tamil Nadu too said on Sunday that the April 1 target would not be met. "Too many sections of the law are yet to be finalised, GST can't happen without consensus on dual control," the state's finance minister said.

State governments have proposed that businesses whose turnover is less than 1.5 crores per year should be administered by them. The centre doesn't agree as it wants to share control with states over taxpayers on goods in all segments. Also, the centre also wants exclusive control on taxpayers who pay service tax, but states too want a share.