The Bill was passed in the Bihar state assembly through a voice vote as all the major parties in the state including JD(U), RJD, Congress and BJP were in favour of the tax reform. Only one of the three CPI-ML MLAs, however, staged a walked out opposing the GST.
Post-ratification by the legislative assembly, the Bill was introduced in the state’s Upper House, where it remained mere formality.
The GST Bill, seen as the largest tax reform in independent India, needs to be ratified by at least half of the state legislatures before the President of India can notify GST Council, which will decide on new tax rate and other issues.
Earlier during a discussion in the state assembly, Bihar chief minister Nitish Kumar said the GST Bill would bring transparency in tax collection and distribution among the Centre and the states. It will also enable the state to earn a handsome portion from the service tax, which earlier used to be an exclusive source of earning for the Union government.
The state would have its share from service tax on Telecom, Railway, Bank and power among others which would bring handsome cash to the exchequer, Kumar said.
In addition, GST would bring parity between manufacturing and consumer states and also do away with expenses on maintaining checkposts on state borders.
While lauding the virtues, Kumar said there are some concerns for Bihar. He said the first concern is that small traders with turnover up to Rs 1.5 crore should be taxed only by the state and they should not be brought under the Centre's domain.
Secondly, for trade above Rs 1.5 crore, the machinery to collect GST should be the exclusive right of the state and the Central Commercial Tax department need not interfere in it in any state. The state machinery would collect this amount and honestly give the due share to the Centre and retain its own.
“We are against Central Commercial tax department opening office at district level and officials of both state and the Centre conducting raids for tax realisation from traders which would result in their harassment,” he said. (RKS)
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