The government on Wednesday passed the key economic reform Goods and Services Tax (GST) regime in the Lok Sabha amid a walkout by the Congress.
However, the Modi government will face the Opposition hurdle when the legislation will be taken up in Rajya Sabha on Thursday.
The Bill was passed in the Lower House where the government has a brute majority, despite the Congress staying away from voting and the AIADMK voting against the legislation. But the government managers are keeping their fingers crossed knowing well that the Opposition might force it to refer the Bill to Select Committee for further consultations in the Upper House.
However, the Opposition Trinamool Congress and BJD are supporting the Bill. Parliamentary Affairs Minister M. Venkaiah Naidu and Finance Minister Arun Jaitley are talking to the Opposition parties to enlist their support for the legislation which proposes a uniform tax regime across India.
"We hope the Opposition parties would have the same view in the Rajya Sabha. We are talking to the parties," Naidu said.
Congress member M Veerappa Moily said the party supports the Bill in principle as it was pushed by the previous UPA also. However, Congress wants that some new clauses added by the government should be consulted in a Select Committee of the upper house.
The government managed the mandated two-thirds majority to pass the constitutional amendment Bill in the lower house. But carrying it forward in the upper house would be a big challenge where the NDA lacks strength.
The Constitution Amendment Bill to implement GST, originally mooted by the UPA, was passed by 352 votes against 37 after the government rejected the Opposition demand of referring it to a Standing Committee.
Noting the Bill would make India a single market, Jaitley rejected the Opposition demand for referring the Bill to the Standing Committee, saying the panel has already examined various provisions of the new legislation and several of its suggestions have been incorporated.
"GST is not a dancing instrument that it will jump from Standing Committee to Standing Committee." Jaitley said he would compensate states for any revenue loss.
"I straightaway concede that 27 per cent (revenue neutral rate) would be very high… We have decided to keep petroleum out, and every state finance minister is not interested inimposing higher taxes on its own people, and neither the Central government," he said.
Jaitley said the proposal to reform the indirect taxes has been pending for the last 12 years and his predecessor P Chidambaram of the Congress had also mooted it during the UPA rule.
Meanwhile, Prime Minister Narendra Modi was not present in the Lok Sabha when it passed the GST bill.
Modi's absence in the Lower House was conspicuous as he has been particular about MPs' attendance and has often made them explain their absence from the House.