SKP Group
SKP GST Update
9 August 2016 | Issue 19
 122nd CAB passed by Lok Sabha, bringing GST a step closer to implementation
The (Amended) 122nd Constitutional Amendment Bill (CAB) for Goods and Services Tax (GST) was unanimously re-adopted by the Lok Sabha (Lower House of Parliament) on 8 August, 2016. The Lok Sabha actively debated on all the amendments proposed by the Rajya Sabha (Upper House of Parliament) on CAB and unanimously adopted all the amendments i.e. omission of 1% additional tax, compensation for States and Consolidated Fund of India etc. along with others as proposed by the Upper House.
Given that the ruling party enjoys a considerable majority of over two third in the Lok Sabha, the passage of the CAB was not expected to be difficult. However, the CAB was still debated on the floor of Lok Sabha. During the debate the Congress party reiterated its stand on rate capping. Also, having gauged that GST would soon become a reality, the opposition advised the government to leverage the experience of Malaysia while implementing GST. The opposition suggested that, India could also introduce an Anti-Profiteering Act (like in Malaysia) which could counter the temporary inflation, if any, in the short run post implementation.

 The Prime Minister in his address made a special note that the GST will act as a catalyst to optimise man, machine, material, money and minutes, thus making GST one among the most crucial economic drivers in India.

The 122nd CAB’s passage through the Lok Sabha finally marked the end of its journey through the central Parliamentary Houses. The CAB will now have to be ratified by at least 50% of the State Governments and Union territories with Legislature after which it will require a Presidential assent to become a Law.
SKP's comments
According to India’s Revenue Secretary Hasmukh Adhia, the government intends on getting the CAB ratified by at least 50% of the States within 30 days or less. Some States have already agreed to ratify the CAB at the earliest, even if they are required to conduct a special session for this CAB.
The onus is now on the government to ensure that the final GST Bill’s (IGST Act, CGST Act and SGST Act) are introduced in the Parliament and State assemblies during the next winter session itself. Furthermore, the decision of introducing the GST Bill either as a Money Bill or as a Finance Bill will also prove to be very crucial, as far as the overall passage of the GST Bill is concerned.

19 Adi Marzban Path | Ballard Estate | Fort | Mumbai 400 001 | India
+91 22 6730 9000 | |
Mumbai | Pune | Hyderabad | New Delhi | Gurgaon | Chennai | Bengaluru
Member of Nexia International
This update contains general information which is provided on an “as is” basis without warranties of any kind, express or implied and is not intended to address any particular situation. The information contained herein may not be comprehensive and should not be construed as specific advice or opinion. This update should not be substituted for any professional advice or service, and it should not be acted or relied upon or used as a basis for any decision or action that may affect you or your business. It is also expressly clarified that this update is not intended to be a form of solicitation or invitation or advertisement to create any adviser-client relationship.

Whilst every effort has been made to ensure the accuracy of the information contained in this update, the same cannot be guaranteed. We accept no liability or responsibility to any person for any loss or damage incurred by relying on the information contained in this update. 

SKP Business Consulting LLP is a member firm of the "Nexia International" network. Nexia International Limited does not deliver services in its own name or otherwise. Nexia International Limited and the member firms of the Nexia International network (including those members which trade under a name which includes the word NEXIA) are not part of a worldwide partnership. For the full Nexia International disclaimer, please click here.

© 2016 SKP Business Consulting LLP. All rights reserved.