States are apprehensive of losing their rights to raise revenue during emergencies.
The two are now chalking out a campaign to take the tax reform to the people as an effort that would reduce the burden on the common man and pave the way for ‘achche din’, or better days.
The poll campaign for Uttar Pradesh Assembly polls, due early 2017, will have the BJP unleash this campaign.
The government also hopes to continue to isolate the Congress, the main Opposition party in the Rajya Sabha, both on the ground as well as in Parliament.
In this, the support from regional parties, many of whom count Congress as the principal rival in their respective states, will become vital.
On Thursday, government strategists dropped broad hints that the subsequent GST Bills - Central GST and Integrated GST - would fall eminently in the category of ‘money Bills’, since at the heart of the two Bills will be provisions related to the Consolidated Fund of India.
During the discussion on GST Constitutional amendment in the Rajya Sabha on Wednesday, the Congress and other Opposition parties had demanded an assurance from Finance Minister Arun Jaitley that the subsequent Bills would not be money Bills.
The FM had expressed inability to give such an assurance since the Bills were yet to be drafted. He maintained that the government will adhere to the Constitution.
The government, however, is confident that a few Opposition parties, barring the Congress, would make an issue out of it.
This is because all smaller parties oppose Congress’ insistence that the tax rate be capped at 18 per cent in subsequent Bills.
States are apprehensive of losing their rights to raise revenue during emergencies.
The Congress is the single largest party in the Rajya Sabha with 60 members, and might stall the passage of these Bills if they were to be tabled as ‘Finance Bills’.
On Wednesday, Congress leader P Chidambaram said his party will campaign across the country for the next three months to tell people how non-fixing of a cap would lead to rise in inflation.
The BJP is planning a counter campaign, whose contours were visible on Thursday with Jaitley holding a press conference along with finance ministry top brass to insist that the GST will not be inflationary.
“We will take our message to the people that the GST will help the common man. We are committed to reforms, development and providing all-round succour to the common people. The Congress should quit its politics of frustration and support Narendra Modi government’s development-oriented governance,” BJP national secretary Shrikant Sharma said.
The Central GST and Integrated GST Bills are to be placed before Parliament in the winter session, scheduled to be held in late November.
For that to happen, at least half the states need to ratify the Bill. Today, Bihar Assemblyended its monsoon session, but its Chief Minister Nitish Kumar phoned Finance Minister Jaitley to convey that a special session will be called to ratify the GST Bill. Congress is a minor partner in Kumar’s government.
Assam Finance Minister Himanta Biswa Sarma said the Bill would be ratified before the state’s budget session ends on August 13.
Several other states, including Biju Janata Dal ruled Odisha, have promised special sessions.
Even Congress state governments expressed their keenness to ratify the Bill at the earliest. Karnataka CM Siddaramaiah said GST will bring transparency.
Andhra Pradesh Finance Minister Yanmala Ramkrishnudu even blamed the Congress for creating obstacles in passage of the Bill. Andhra is ruled by BJP ally Telugu Desam Party.
While the Congress finds itself in a corner, the Communist Party of India (Marxist) chief Sitaram Yechury said his party will protest if the subsequent Bills are brought as ‘Money Bills’.
He also expressed his fears that GST will increase the burden of indirect taxes. He also said that his party was concerned about the states’ right to raise resources. The Left has governments in Kerala and Tripura.
The Left’s concerns were shared by Bharatiya Mazdoor Sangh, which counts the Rashtriya Swayamsevak Sangh (RSS) as its ideological parent.
The BMS said it would oppose the GST. “GST is to ease corporate taxing. It will be a burden on the common man. BMS does not appreciate such moves and will raise its voice against it,” said Pawan Kumar, organising secretary. Sources said BMS has its own compulsions as regards to its support base.
But BJP’s traditional support base of traders supported the GST. The Confederation of All India Traders (CAIT) on Thursday welcomed the government’s announcement that there will be single return for both CGST and SGST and there will not be any dual control of authority under the GST regime.
In other good news for the government, BJP MP Subramanian Swamy said he would refrain from commenting on the merits of the legislation because of a conflict between his scholarly commitment to economics and loyalty to the party.
Photograph: Reuters