Budget 2012: Quick passage plea spurs hope of GST rollout in 2013

Finance minister Pranab Mukherjee may not have given any time-frame for rolling out the Goods and Services Tax ( GST) but analysts say that the changes in indirect taxes suggest that progress is being made in the most ambitious tax reforms yet.

Introduction of GST has missed several deadlines. Mukherjee on Friday appealed to all political parties for the early passage of GST and Direct Tax legislations. He said drafting of model legislation for central and state GST is in progress as the government awaits the recommendations of the standing committee of Parliament on the Constitution Amendment Bill.

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The GST network (GSTN), which has been approved by the empowered committee of state finance ministers, will be operational as a national information utility by August 2012. “The use of PAN as a common identifier in both indirect and direct taxes will enhance transparency and check tax evasion ,” Mukherjee said.

Experts are hopeful that GST will be introduced by April, 2013. “While there are no specific comments on rolling out GST, the August 2012 schedule 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.