Delhi Assembly on Wednesday ratified Goods and Service Tax (GST) Constitution Amendment Bill, becoming the third non-BJP-ruled state and overall the eighth to clear the proposed tax regime, billed as single biggest tax reform in decades.
The bill was endorsed by the House by a voice vote following a brief discussion during which Deputy Chief Minister Manish Sisodia called GST a “big reform” which will be good for the country’s economy and growth.
The two BJP legislators were not present when the bill was ratified as they had staged a walkout over a separate issue, while another party MLA was serving suspension from the House for allegedly making derogatory remarks against an AAP legislator.
Delhi’s share in central taxes has been stagnant at Rs 325 crore for the last 17 year and rolling out of GST is expected to increase its share in central taxes significantly.
“It’s good for the entire country, not only for Delhi. It will be extremely helpful in terms of services. For the last 17 years, Delhi has been getting Rs 325 crore as its share of Central taxes despite contributing as much as Rs 1,37,000 crore to the country’s GDP. GST is a big reform,” said Sisodia.
The AAP government has been supporting the Centre on the GST though both sides are locked in a bitter tussle over a range of issues for the last one-and-half years.
Speaking during the brief discussion on GST, a number of AAP MLAs hailed the proposed tax regime.
Later the Deputy Chief Minister, took a jibe at the Centre saying it has for the first time recognised the national capital as a “state”.
“GST bill for the first time recognises Delhi as a state under the new Constitutional amendment to Art 366 - step in right direction finally,” he said in a tweet.
The 122nd Constitution Amendment Bill has already been ratified by Bihar, Jharkhand, Chhattisgarh, Himachal Pradesh, Assam, Gujarat and Madhya Pradesh.
Delhi is the third non-NDA state after Bihar and Himachal to ratify the bill.
The GST bill, seen as single biggest tax reform in a long time, needs to be ratified by at least 15 state legislatures before the President can notify the GST council which will decide the new tax rate and other issues.
The Lok Sabha had passed the GST bill on August 9 while Rajya Sabha cleared it on August 4.
In his remarks, Sisodia said there were some concerns over capping the annual turnover.
“There is no clarity on certain issues. Like businessmen in the capital with a turnover of up to Rs 20 lakh do not have to pay taxes. It should not be brought down.
“We are in favour of increasing the threshold to Rs 25 lakh. Businessmen with a turonover of up to Rs 1.5 crore should pay taxes directly to the state government,” he said.
Sisodia said Union Finance Minister Arun Jaitley had written to Chief Minister Arvind Kejriwal on the GST issue on August 11.