In the biggest tax reform since Independence, the national sales tax or GST Bill was approved by the Rajya Sabha on Wednesday, to replace a raft of different state and local taxes with a single unified value added tax system, turning the country into the world’s biggest single market.
The 66-year-old Constitution, which gives power to Centre to levy taxes like excise, and empowers states to collect retail sales taxes, was amended though the 122nd Constitution Amendment Bill.
The legislation was approved by the Upper House with 203 votes in favour and none against, after a seven-hour debate during which a rare bonhomie was witnessed among the ruling and the opposition parties.
Replying to the debate, Finance Minister Arun Jaitley said the GST rate will be kept “as low as possible” but did not commit to a specific rate despite opposition benches pressing for it.
We will also try and keep the rate as low as possible, certainly much lower than what the present situation is. And as compliance increases, the possibility of that rate coming down further would be there
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