NEW DELHI: India’s plans to rationalise state and federal indirect taxes into a harmonised goods and service tax (GST) took a step closer to reality after New Delhi struck a deal with recalcitrant states, said government sources.
Finance Minister Arun Jaitley brokered a compromise on Monday that would pave the way for a key constitutional amendment to be tabled in the current parliamentary session that runs to December 23.
The GST implementation has been held up for years, with some states reluctant to give their assent for fear of revenue losses. Even after Monday’s compromise, the tax is not likely to take effect until April 2016.
In critical concession, Jaitley offered to compensate the states for any loss of revenues. Reuters