The Assam assembly unanimously passed the Constitution Amendment Bill on Goods and Services Tax on Friday, becoming the first state to ratify the crucial tax reform legislation.
"I declare the bill, which was passed by both Houses of Parliament, to be ratified unanimously by Assam Assembly," Speaker Ranjeet Kumar Dass announced in the House.
Although the Congress party and the All India United Democratic Front MLAs supported the bill, they had earlier sought a discussion in the assembly to evaluate its impact on Assam and the people. But they were turned down by the Speaker.
Following passage of the Constitution Bill, 2014, Dass and Finance Minister Himanta Biswa Sarma, who introduced it in the House, exchanged sweets.
Sarma said Chief Minister Sarbananda Sonowal wanted that Assam becomes the first state to pass the amendment as this would send a positive signal to the industry.
"We have always lagged behind, but want to be the first in passing this bill. This is a historic proposal. I thank the Speaker for allowing us to introduce it today after we informed him just last night," said Sarma, who introduced the bill on behalf of the chief minister.
Sarma said after Brazil and Canada, India will be the third country in the world to collect GST by both centre and state through a new body -- the GST council.
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 government has set a deadline of April, 2017 for its rollout.
Sarma said in the House that "of the central GST portion, 42 per cent tax will be given back to the state again."
The GST will also have a special concession option for NE and Himalayan states if they request reduction of taxes for any reason, he claimed.
"Besides, we can also collect special tax during natural calamities like flood if we feel the need to generate more revenue. But everything will have to be approved by the GSTC," he added.
