Bihar First Non-NDA State to Approve GST Bill

Chief Minister Nitish Kumar holding a press conference outside Bihar Assembly after the GST Bill was passed on Tuesday.

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Patna: The state House in Bihar on Tuesday approved the Goods and Service Tax (GST) through a voice vote thus becoming the first non-NDA state in the nation to ratify the Constitutional Amendment on GST.

The bill was approved in a rare case of unanimity among all major political parties in Bihar including the Janata Dal – U, Bharatiya Janata Party (BJP), Rashtriya Janata Dal (RJD), and Congress.

The move, however, was opposed by the Communist Party of India (ML) whose lone legislator walked out from the House in protest against the bill.

Earlier, Assam, a BJP-ruled state, had passed the GST Bill thus making Bihar the second state in the country to ratify the amendment.

The bill that purports to introduce major reform in the tax law, needs to be approved by a minimum of 15 state legislatures before it goes to the President who will then pass it on to the GST Council that will then determine the new tax rates to be finalized before April 2017.

Chief Minister Nitish Kumar, jubilant over the passing of the bill in the state Assembly, said that he was in favor of the bill since the idea was first floated by former Finance Minister Pranab Mukherjee saying it would usher great transparency in the tax collection process and subsequent distribution among the states.

For a cash-strapped state like Bihar particularly in the wake of the massive loss of revenue due to the recent implementation of prohibition in the state, the proposed tax reforms would also mean financial bonanza for the states that would now be able to share the service tax on a number of sectors like banks, railways, telecommunication etc. that were earlier kept by the Center.

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