New Delhi: The Goods and Services Tax (GST) bill appeared to be headed for smooth passage in the Rajya Sabha as nearly all major parties, barring the AIADMK supported the bill during the debate.
Most of the opposition parties also backed the Congress` demand for a cap on the maximum tax under the bill, and also urged the government not to bring the bills on Centre and State GST that will follow as money bills.
On Wednesday, the Goods and Services Tax Bill, technically called the Constitutional (One Hundred and Twenty-Second Amendment) Bill, 2014, was introduced for discussion in the Rajya Sabha.
AIADMK member A. Navaneethakrishnan, participating in the debate in the upper house, called the bill "unconstitutional".
"This bill is not constitutional because it violates state`s fiscal autonomy, and also it will mean revenue loss to Tamil Nadu; so we oppose this bill," Navaneethakrishnan said.
Most other parties however were in agreement on the idea of a pan-India Goods and Services Tax and said they supported the bill.
Communist Party of India-Marxist (CPI-M) leader Sitaram Yechury said the debate on a goods tax has taken place even in the constituent assembly.
He asked the government to make provisions to ensure states are not reduced to begging, and said that the subsequent two bills on GST that the government will bring should not be money bills.
"The goods tax is not a new concept, it has been going on since the constituent assembly debates," he said.
Yechury also quoted B.R. Ambedkar from the debates in the constituent assembly and said he concluded that the right for levying goods taxes should be with the provinces so that they have a source of revenue.
"What will be the legitimate rights of state? How do we protect that right?" Yechury said.
Yechury sought assurance that the government will "ensure there is a flexibility" so that states do not end up coming with a begging bowl to the Centre.
"This is a very serious piece of legislation; we are making a major departure... Don`t bring it as money bill," he said.
Samajwadi Party leader Naresh Agrawal said his party was not opposing the bill becuase they did not want to be seen as the one blocking development.
"Even if we don`t want, we are supporting this bill so that a message doesn`t go that Samajwadi Party is becoming an obstacle towards economic progress of the country," Agrawal said.
He backed the Congress` demand of putting a cap on the maximum tax.
"Congress wanted an 18 per cent cap on GST. But, the government did not do it because their intention is to increase the tax. The government is saying that it might be required to increase the tax later, and a Constitutional amendment would be done again. Why don`t you fix the maximum rate, and maintain a minimum rate; then there will be no requirement for Constitutional amendment," he said.
Janata Dal-United leader Sharad Yadav also extended support to the bill and said: "The GST has been hanging for the past 12 years. Today, I am standing in support of GST."
"The only reason for corruption in indirect taxes in our country is because of the several layers of taxation in our country. Single taxation will solve this problem. Our party has been in support of the bill since the beginning. But, I have a request to the government not to bring it as a money bill. Let there be a consensus on this by discussion and debate," Yadav said.
Trinamool Congress leader Derek O`Brien also supported the bill and attacked both BJP and Congress saying they keep switching sides on supporting the bill.
"We often get confused when they are supporting, when they are not supporting, because what their stand is depends on where they sit. My party is consistent on this - in 2009, 2011, 2014, and 2016 manifestos - we have promised GST. We promised it as an idea and as an implementation," the TMC leader said.
Biju Janata Dal leader A.U. Singh Deo, extending support to the bill, said the provision for green tax should be given some time.
"We support the bill but we have certain issue. There is a green tax which does not seem to find favour with lot of people. Odisha is a mineral rich state. There is environmental impact so the mineral rich states should be given time before putting the green tax," Deo said.
Bahujan Samaj Party MP Satish Chandra Misra, while supporting the bill, said it should be ensured that the federal structure is not effected.