The proposed Goods and Services Tax (GST) will benefit most of the states from the first day of its inception, while industries and common man also stand to gain, Finance Minister Arun Jaitley said on Monday.
Speaking at the meeting of the Parliamentary Consultative Committee attached to the Finance Ministry, Jaitley said GST would help reduce tax-on-tax and would be beneficial to consumers.
GST will benefit most of the States from Day 1, especially consumer states, he said, adding, "As the volume of trade expands and growth momentum picks up, every State will benefit with the rise in their revenue collections."
A Constitutional Amendment Bill on the new indirect tax regime which was introduced in the Lok Sabha on December 19, will be taken up by the Parliament in the Budget Session.
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The government intends to roll out GST, which will subsume most of the indirect taxes, from April 1, 2016.
The Finance Minister said GST will be beneficial to the Centre, States, industrialists, manufacturers, the common man and the country at large since it would bring greater transparency, better compliance, increase in GDP (gross domestic product) growth and revenue collections.
Jaitley also said government was open to any suggestions for making further improvements on the GST Bill.
The Finance Minister's statement said most of the committee members supported the decision of the government to implement GST.
Members also made suggestions, including that the Centre may bring out a 'white paper' giving details on revenue to the Centre, States and who will be the ultimate beneficiaries.
A member also suggested the Finance Commission may be made a permanent body for allocation of funds to States.
Members who attended the meeting include, Anoop Mishra, SPY Reddy, Poonam Mahajan, Sriram Malyadri, Anil Desai, Satish Chandra Misra, Rajkumar Dhoot and Sukhendu Sekhar Roy.
"GST is a continuing process which would further evolve and improve with time," a statement quoted the minister as saying.
The government has even made provisions in the GST Bill to remove apprehensions among States about the fall in their revenue collections.
The government, Jaitley added, was in favour of strengthening the cooperative federalism and will make all out efforts to evolve as much consensus as possible on GST.
The Finance Minister further said the Centre would compensate States for any loss of revenue arising on account of implementation of the GST for a period of five years.