GST panel asks centre for more flexible approach

August 19th, 2011 - 9:41 pm ICT by IANS  

New Delhi, Aug 19 (IANS) An empowered committee of state finance ministers Friday urged the central government to show more flexibility in its approach to ensure timely introduction of the Goods and Services Tax (GST).

“The central government has to be flexible and will have to address all the concerns of the state governments,” Bihar Finance Minister Sushil Modi, who is also the chairman of the empowered panel, told reporters after the meeting here.

Modi said the panel was hopeful to meet the deadline of April 1, 2012 for introduction of the proposed indirect tax reforms.

Introduction of the GST, which seeks to reform indirect tax structure in the country, has been pending for years due to lack of political consensus among states on the issue.

The main opposition BJP-ruled states like Gujarat, Madhya Pradesh, Chhattisgarh and Himachal Pradesh have raised concerns over the proposed tax reform, saying it would erode their autonomy to levy taxes.

The GST Constitution Amendment Bill was introduced in the budget session of parliament and then was referred to a Parliamentary Standing Committee on Finance.

The proposed tax reform seeks to bring uniformity in indirect tax structure.

Introduction of GST, which will subsume central and state taxes like excise, customs, service tax, sales tax and VAT, has been pending for years in the absence of political consensus among states.

This was the first meeting of the empowered committee of state finance ministers on GST under the chairmanship of Modi.

Modi, who was elected as the chairman of the GST panel last month, said the issue of compensation to states was the focus of the meeting.

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