13/05/2015 2:51 PM IST | Updated 15/07/2016 8:25 AM IST

Government Fails To Get GST Past Opposition, Refers It To Committee

SAJJAD HUSSAIN via Getty Images
Indian finance minister Arun Jaitely looks on as Reserve Bank of India (RBI) governor Raghuram Rajan addresses a press conference after a meeting with the Central Board of Directors of the Reserve Bank of India in New Delhi on August 10, 2014.India's central bank governor Raghuram Rajan has defended his recent decision to keep the interest rates unchanged, reassuring that the current policy will bring down the spiralling inflation. Rajan addressed a meeting of the central board of the Reserve Bank of India (RBI) in New Delhi, which met with the finance minister Arun Jaitley for the first time after he presented the maiden budget of his right-wing government in July. AFP PHOTO/ SAJJAD HUSSAIN (Photo credit should read SAJJAD HUSSAIN/AFP/Getty Images)

NEW DELHI — The Narendra Modi government put all it had into passing the GST bill and still failed to get past an united opposition in the Rajya Sabha, who insisted on further legislative scrutiny. In other words, this bill is stalled for now.

The bill has now been referred to a select committee, comprising 21 members, and where the government is in a minority. The panel will give its report only by the first week of the monsoon session. If the government disagrees with the recommendations, the bill might be delayed further down the year.

Finance Minister Arun Jaitley moved the motion for referring the bill to the Select Committee, after Congress members made it clear that they will not back the bill with its existing provisions. The GST bill was approved by Lok Sabha on Wednesday last after a walkout by Congress.

While the government was keen that GST is approved as early as possible, it wanted to do it with the widest-possible consensus without appearing confrontationist. That is important, because its implementation would require full cooperation of state governments, some of which are headed by chief ministers of rival parties. However, it clearly did not foresee the strength of opposition parties who are opposed to certain provisions of the bill that the Modi government has introduced.

READ: 7 Things You Need To Know About GST

Being a Constitution amendment bill, it requires to be passed by both Houses of Parliament by a two-third majority.

Once passed by Parliament, the Bill will then need ratification of more than half of 29 states before scheduled roll out in April next year.

The Committee constitutes of Bhupender Yadav, Chandan Mitra and Ajay Sancheti (of BJP), Madhusudan Mistry, Mani Shankar Aiyar and Bhalchandra Mungekar (of Congress), Naresh Agrawal (SP), K C Tyagi (JD-U), Derek O'Brien (Trinamool Congress), Satish Chandra Misra (BSP), A Navaneethakrishnan (AIADMK), K N Balagopal (CPI-M), Dilip Kumar Tirkey (BJD), C M Ramesh (TDP), Praful Patel (NCP), Kanimozhi (DMK), Anil Desai (Shiv Sena), Naresh Gujral (SAD), Mohammad Fayaz (PDP), D Raja (CPI), Rajeev Chandrasekhar (Independent).

GST was first mooted 12 years ago but couldn't be approved as states feared curbs on their fiscal powers. Jaitley had made this a priority and had held discussions with all chief ministers but did not manage to bring key opposition figures on board.

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