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BW Businessworld

GST To Be Operational By Aug '12

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The Finance Minister Pranab Mukherjee in his Union Budget 2012-13 speech said that the Goods and Services tax (GST) will be operational by August 2012.

To operationalize the GST, the Constitution (115 th Amendment) Bill has been introduced in the Lok Sabha in March 2011 to enable Parliament and state legislatures to make laws for levying GST on every transaction of supply of goods or services or both.

Some goods, namely crude petroleum, diesel, petrol, aviation turbine fuel, natural gas and alcohol are not to come under the purview of the GST.

The constitutional amendment bill also seeks to empower the President to set up within 60 days of the passage of the legislation, a GST Council with the union Finance Minister as chairperson and union Minister of State for Revenue and Finance Ministers of all the states as members. The GST Council is to work on the basis of consensus and make recommendations on issues like GST rates, exemption lists, and threshold limits. Further, the bill provides for setting up of a GST dispute settlement authority, comprising a chairperson and two members to resolve disputes arising out of deviations from the recommendations of the GST Council either by the central or state governments. The draft Bill has since been referred to the Parliamentary Committee on Finance for examination

Among the other steps that are being taken for the introduction of the GST is the establishment of a strong information technology (IT) infrastructure. For this purpose the government has set up an Empowered Group headed by Nandan Nilekani, Chairman, Unique Identification Authority of India (UIDAI). Significant progress has been made in the conceptualization and design of the GST Network (GSTN) - a common portal for the centre and states that will enable electronic processing of the key business processes of registration, returns, and payments. For this purpose, the structure of these processes is in advanced stages of finalization.

The National Securities Depository Limited (NSDL) has been selected as technology partner for incubating the National Information Utility that will establish and operate the IT backbone for the GST. In this regard the NSDL has set up a pilot project in collaboration with eleven states prior to its roll-out across the country.