Don’t miss the latest developments in business and finance.

Difficult to accept Congress demand on GST cap: Jaitley

Image
Press Trust of India New Delhi
Last Updated : Mar 18 2016 | 12:06 AM IST
Finance Minister Arun Jaitley on Thursday said it is difficult to accept demand of the Congress to cap goods and services tax (GST) rate in the pending Constitution amendment Bill, but remained hopeful that it will get passed in the second half of the Budget session. “Every state government is in favour of GST. You have every political party in Parliament which has said they will vote in favour,” he said, adding, “In the Lok Sabha, the Congress walked out, every other party voted in favour. The Congress party now made a statement that it has only one issue about the Constitutional cap which is a little difficult because our tariff is not decided through Constitution amendment.”

The GST Bill has already been passed by the Lok Sabha and is pending ratification by the Upper House, where the ruling National Democratic Alliance does not have a majority. After it is approved by the Rajya Sabha, the legislation needs to be approved by half of the 29 states so as to roll out GST possibly by October 1.

Explaining the rationale, the finance minister said, it is extremely difficult to accept because every time you need to increase tariff in a given emergency, you have to amend the Constitution.

More From This Section

The tariff needs to be decided by the GST Council and not by a Constitutional cap, he explained.

"I think that's the only glitch that remains. I would still want the Congress party to come on board. I can easily see and this is going to happen at this stage of biennial election. The numbers are significantly changing and in any case, I am reasonably confident that the numbers in the Upper House now also are in favour of GST," he said.

Asserting that it is "extremely difficult to achieve double-digit growth in the current global environment, Jaitley said there is scope for improvement from the current rate if reforms are carried on.

"I don't claim that it is possible in this global environment to come any where close to double-digit growth. It's extremely difficult, it's practically impossible to do that," he said.
Earlier, Aroon Purie, Chairman & Editor-in-Chief of the

India Today Group, said national life is becoming a tissue of contrived resentments as "lawyers are breaking the law, law makers are violent, lunatic fringe is feeling emboldened to spout their venom (and) irrelevant debates of identity and nationality have pre-occupied the national agenda."

The atmosphere and social anxiety led to "a bright young Indian taking his own life and another being jailed for chanting slogans and a man being lynched for what he stored in his fridge," Purie said.

Counselling Prime Minister Narendra Modi to heed to the advice of President Barrack Obama that democracy requires basic bonds of trust between its citizens, he said, "It doesn't work if we think that our political opponents are unpatriotic or trying to weaken America.

He said to get real reforms in this country, the ruthlessness of Sardar Patel, the guts of Indira Gandhi and vision of Pandit Nehru are needed.

Finance Minister Arun Jaitley said given the various variables India can at least aim high and improve.

"For example, if you carry on some of the pending reforms and if you concentrate on some of these areas like manufacturing, investment in agriculture etc... If you can improve health of the banking system so as it supports growth, your private sector becomes more oriented to investment.

"If you are not able to go anywhere close to double-digit growth, the prospect of greater economic activity and improving upon your present rate is always there... The idea is to improve upon our growth rate even in the adverse global environment," he said.

Terming the current 7-7.5 per cent growth "impressive" compared to the global growth, Jaitley said, "compared to our own inherent ability, one always feel that India can do much better."

If India has to increase growth by 2 per cent from the present capacity, he said, a combination of several factors would be required including a supportive global environment and increasing share of manufacturing in economy.

Also Read

First Published: Mar 18 2016 | 12:02 AM IST

Next Story