Quick passage plea spurs hope of Goods and Services Tax rollout in 2013

Finance minister Pranab Mukherjee did not given any time-frame for rolling out the Goods and Services Tax but analysts said the changes on the indirect taxes front unveiled on Friday suggested that progress was being made on launching the most ambitious tax reform.
Mukherjee appealed to all political parties for early passage of the GST and Direct Tax legislations. Introduction of GST has missed several deadlines.
He said drafting of model legislation for central and state GST in consultation with states was in progress as the government awaits the recommendations of the standing committee of Parliament on the Constitution Amendment Bill.
The finance minister also said the structure of GST network (GSTN), which has been approved by the empowered committee of state finance ministers, would be set up as a national information utility and will be operational by August 2012.
The GSTN will implement common PAN-based registration, returns filing and payments processing for all states on a shared platform. “The use of PAN as a common identifier in both indirect and direct taxes will enhance transparency and check tax evasion,” Mukherjee said.
Experts said they were hopeful that GST would be introduced by April, 2013. “While there are no specific comments on rolling out GST, the date of August 2012 for setting up GSTN suggests there is progress. All the changes on the indirect taxes side is fully compatible with GST rollout,” Rajiv Dhimri, partner at tax consultancy firm BMR Advisors, said.
The finance minister raised the service tax rate to 12% from the existing 10% and also raised the excise duty to 12% from 10%. The government had reduced the standard rate of non-petroleum goods to 8% from 14% to cushion the impact of the 2008-09 global financial crisis. As part of its stimulus exit process, it raised the duty to 10% in the 2011-12 budget. Mukherjee said the government raised the duty on Friday given the imperative of fiscal correction.
Budget 2012
Budget News 2012