Taking a step closer towards consensus on the Goods and Services Tax Bill, Prime Minister Narendra Modi held discussions with Congress President Sonia Gandhi and former Prime Minister Manmohan Singh.
After the meeting, which lasted a little over 30 minutes, Finance Minister Arun Jaitley told reporters that the Congress put forth three demands on the Bill and the government conveyed its position on the issues.
Jaitley said, “The Congress will discuss the outcome of the meeting in their party and there may be another meeting on the same.”
The Congress leaders reiterated their demands for a revenue-neutral rate not higher than 18 per cent, doing away with the additional one per cent tax for producing States and more powers for States in the GST council, as well as setting up of a redressal mechanism. While the government was weighing the option of accepting a revenue neutral rate of 18 per cent and announcing it during the ongoing session of Parliament, it is not willing to accept the Congress demand of making the rate a part of the Act. The BJP wanted a rate of 22 to 23 per cent.
In fact, Jaitley has already questioned the Congress demand to include GST rates in the Constitutional Amendment Bill and said it would lead to a flawed architecture for the tax.
On the issue of an additional one per cent inter-State tax for supply of goods, the government conveyed to the Congress leadership that it would be difficult. On the redressal mechanism, the government seems to have conveyed to the Opposition that it will be done in the spirit of the Constitution.
The meeting was also attended by Jaitley and Parliamentary Affairs Minister Venkaiah Naidu. Jaitley said Naidu will hold discussions with the leaders of the Congress in both the Houses.