History of GSTby Anil T. Consultant
A few countries over the world have just implemented GST. To give some examples - Canada supplanted the Manufacturer's Sales Tax with GST in the year 1991, Australia supplanted the Federal Wholesale Tax with GST in the year 2000 and New Zealand traded their sales taxes for certain goods and services with GST in the year 1986. India executed its GST framework (Goods and Services Tax (CGST) in 2017 to cut formality and increment tax revenues, which thus would fuel economic development.
The Vajpayee Government, in the year 2000, set up a committee, headed by Asim Dasgupta, Finance Minister of the West Bengal Government. The committee was given the obligation of planning the GST model and dealing with the IT back-end readiness for its rollout.
In Budget 2006-07, Union Finance Minister Shri P. Chidambaram proposed usage of Goods and Services Tax (GST) by April 1, 2010. The committee of State Finance Ministers, notwithstanding, just discharged its First Discussion Paper on the tax regime in November, 2009.
The new tax regime, at last, became effective on July 1, 2017.
History of GST
Here is a gander at the course of events of 'one country, one tax' framework:
(i) 2000: The Vajpayee Government set up the committee, headed by Asim Dasgupta, Finance Minister of the West Bengal Government.
(ii) 2003: A task force is framed under Vijay Kelkar to propose tax reforms.
(iii) 2004: Vijay Kelkar suggests supplanting the current tax regime with GST.
(iv) 2006: In Budget 2006-07, Union Finance Minister Shri P. Chidambaram proposed the execution of Goods and Services Tax (GST) by April 1, 2010.
(v) 2008: The Empowered Committee hands over a report on the guide of GST in the nation.
(vi) 2009: The committee presents a conversation paper on GST, inviting discussion. The Finance Minister Pranab Mukherjee reports the essential structure of GST.
(vii) 2010: Finance Ministry starts strategic computerization of business taxes in states. GST delayed to April 1, 2011.
(viii) 2011: Congress party presents the Constitution (115th Amendment) Bill to execute GST. After the opposition protest, the Bill is passed to a Standing Committee.
(ix) 2012: Meetings held with different state finance minister. The last date for issues to be settled set on 31 December 2012.
(x) 2013: In his Budget discourse, Chidambaram, arranges Rs. 9,000 crore to repay states for misfortunes endured due to GST.
(xi) 2014: Standing Committee clears GST Bill but lapses as Lok Sabha was dissolved. Finance Minister, Arun Jaitley, presents the Constitution (122nd) Amendment Bill at the Lok Sabha.
(xii) 2015: New last date for rollout of the new tax regime set as April 1, 2016. GST bill passed in Lok Sabha, yet not Rajya Sabha.
(xiii) 2016: Rajya Sabha passes the Constitution Amendment Bill. GST Council concurs on four slab tax structure (5%, 12%, 18% and 28%) alongside an additional cess for luxury goods.
(xiv) 2017: Final GST implemented on July 1, 2017.
What are the advantages of GST?
Here is the list of advantages of GST:
i. Unified common market.
ii. Tax structure streamlined with lesser exceptions.
iii. Removal of cascading effect.
iv. Taxpayers will have a common portal (GSTN).
v. Transparency in tax administration.
vi. Lift to the economy over the long haul. Thus, expanded supply and demand of goods and services.
vii. Consistent SGST + CGST and IGST rates due to which fewer cases of tax evasion were reported.
viii. Purchasing input goods and services for manufacturing from different states gets less expensive.
Created on Apr 17th 2020 05:40. Viewed 374 times.