GST closer to reality: Key features you should know about 'one nation, one tax'

Know here the salient features of GST Bill.

Zee Media Bureau

New Delhi: In the biggest tax reform since Independence, the 'one nation, one tax' or GST Bill was Wednesday approved by the Rajya Sabha to replace a raft of different state and local taxes with a single unified value added tax system to turn the country into world's largest single market.

The 66-year-old Constitution, which gives power to Centre to levy taxes like excise, and empowers states to collect retail sales taxes, was amended though the 122nd Constitution Amendment Bill.

The salient features of the Bill are as follows:

-Conferring simultaneous power upon Parliament and the State Legislatures to make laws governing goods and services tax

-Subsuming of various central indirect taxes and levies such as  central  excise  duty,  additional  excise  duties,  service  tax,  additional  customs  duty  commonly  known  as  countervailing duty, and special additional duty of customs

-Subsuming of state value added tax/sales tax, entertainment  tax (other than the tax levied by the local bodies), central sales  tax (levied by the Centre and collected by the States), octroi and
entry tax, purchase tax, luxury tax, and taxes on lottery, betting  and gambling;

-Dispensing  with  the  concept  of  ‘declared  goods  of  special  importance’ under the Constitution

-Levy  of  Integrated  Goods  and  Services  Tax  on  inter-State  transactions of goods and services

-GST to be levied on all goods and services, except alcoholic liquor  for human consumption. Petroleum and petroleum products shall be  subject  to  the  levy  of  GST  on  a  later  date  notified  on  the  recommendation of the Goods and Services Tax Council;

-Compensation to the states for loss of revenue arising on account  of implementation of the Goods and Services Tax for a period of  five years

-Creation of Goods and Services Tax Council to examine issues  relating to goods and services tax and make recommendations to  the Union and the States on parameters like rates, taxes, cesses  and  surcharges  to  be  subsumed,  exemption  list  and  threshold  limits, Model GST laws, etc. The Council shall function under the  Chairmanship of the Union Finance Minister and will have all the State Governments as Members.