The Union Cabinet gave its approval on Wednesday to the 122nd Constitutional Amendment Bill on the Goods and Services Tax (GST). The Centre plans to share the proposed Bill with the Empowered Committee of State Finance Ministers on GST by Friday. The Centre is keen to introduce it in Parliament during the current session which is scheduled to end on Tuesday.
"The Cabinet has approved the Bill ," highly placed government sources told The Hindu.
The proposal is that all the indirect taxes imposed by the Centre and States — including the services tax, excise duties, stamp duties, entry tax, and central sales tax — be subsumed into just one tax, the GST, for simplification and efficiency.
Union Finance Minister Arun Jaitley has proposed to extend the GST to all petroleum products and also to real estate transactions. To begin with, the rate of taxation for petroleum will be kept at 0 per cent.
The GST on real estate transactions, the Centre hopes, will reduce black money generation in the sector.
The Bill proposes that the Centre be empowered to tax sales of goods and States get to tax services. At present, the Centre can tax services but not sales and distribution of goods. States can currently tax sales and distribution of goods but not services.
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