One Nation, One Tax: GST launched

New Delhi: Prime Minister Narendra Modi at midnight unveil the new tax regime replacing overnight the messy mix of more than a dozen state and central levies built up over seven decades, with a one national GST unifying the country’s USD 2 trillion economy and 1.3 billion people into a common market.
The new indirect tax regime in the country is to come into effect from July 1, wherein fixation of GST rates on the supplies is joint responsibility of the Central and State governments after the approval from the GST Council.
Calling the GST a “disruptive change”, President Pranab Mukherjee tonight said the ambitious central tax is a “tribute” to the maturity and wisdom of India’s democracy, as he recalled steps taken during his own tenure as Finance Minister on this key reform measure.
He also said the GST Council should continuously review the implementation and suggest suitable improvements to the new indirect taxation regime.
“The new era in taxation, which we are about to initiate in a few minutes, is the result of a broad consensus arrived at between the Centre and states,” Mukherjee said minutes before the GST rollout in his speech at a special function in the central hall of Parliament.
“This consensus took not only time but also effort to build. The effort came from persons across the political spectrum who set aside narrow partisan considerations and put the nation’s interests first. It is a tribute to the maturity and wisdom of India’s democracy,” he said.
The President termed the Goods and Service Tax (GST) a disruptive change.
“It is also a moment of some satisfaction for me because, as the Finance Minister, I had introduced the Constitution Amendment Bill on March 22, 2011,” he said.
“It is similar to the introduction of VAT when there was initial resistance. When a change of this magnitude is undertaken, however positive it may be, there are bound to be some teething troubles and difficulties in the initial stages,” he said.
Under GST, Mukherjee said the tax incidence will be transparent, enabling full removal of tax burden on exports and full incidence of domestic taxes on imports.
By creating a unified common national market, the GST will act as a major boost to economic efficiency, tax compliance and domestic and foreign investment, the President said.
The President further said, “As we usher in the creation of one nation, one tax, one market, let me conclude by calling upon every Indian to extend cooperation in the successful implementation of the new system.”
Prime Minister Narendra Modi said India will embark on a new economic system with the rollout of the Goods and Services Tax (GST).
“We are going to determine the future economic roadmap of this country with the GST rollout,” the prime minister said in special session of Parliament for GST launch.
India’s 1.25 crore people will witness tonight’s historic midnight launch of GST, PM Modi said.
He said the GST launch is not an achievement of one government or one party but a collective effort of the entire nation.
“The best brains of the country have worked on GST,” he said, adding “The poor of this country will benefit most from it.”
PM Modi said GST is an example of cooperative federalism which will encourage everyone to work together in future. (Agencies)