For once, it is the government, which has moved with lightning speed in its race to meet the GST rollout deadline of April 1,2017, while India Inc seems to be biting its nails and wondering how will it be able to keep pace with it.
On Monday, the union cabinet led by Indian Prime Minister Narendra Modi approved the formation of GST Council, which was another major milestone in the journey of implementation of goods and services tax (GST) law, which will unify all existing indirect taxes to create a single nationwide market.
The speed with which the government has moved till now on the crucial tax law it is well on track for the final destination, but corporates have expressed their inability to meet the deadline, which they have asked to be pushed back by a quarter or two.
"Industry bodies have been asking for more time. They want it to be delayed by a quarter or two. They would like to see the fine print and then prepare for the GST regime," said Mahesh Jaising, partner, BMR & Associates LLP,
And a fine-print wouldn't emerge before November or December. Jaising said in many overseas markets, where GST has been introduced, corporates were given about a year to tune their system to new tax regime.
However, Jaising's colleague Rajeev Dimri, leader, indirect tax, BMR & Associates LLP, said there was "no case" for India Inc to be in "wait and watch" any more.
"There is no case anymore for India Inc to remain in the wait and watch mode. It's high time that businesses roll up their sleeves to work towards creating a GST compliant internal set up by the go-live date," he said in a statement issued by BMR & Associates LLP, a consulting firm.
As per the article 279A (1) of the amended Indian constitution, the GST Council has to be formed within 60 days after it comes into force (Monday).
The council will make recommendations on matters such as standard GST rate, model GST laws, principles that will govern the place of supply, threshold limits, goods and services that could be exempted from the levy and other matters relating to the indirect tax.
It will be chaired by Indian finance minister while minister of state for finance and state finance ministers will be its members. The central government will have 1/3rd vote and the states will have two-third vote in the Council. Any decision will need 3/4 majority.
Monday also saw Cabinet appointing the revenue secretary as the ex-officio secretary to the Council. The next meeting of the Council is slated to be held on September 22 and September 23.
"We are fully geared up for April 1, 2017, deadline for GST rollout," Hashmukh Adhia, revenue secretary in the finance ministry told the press after Cabinet meeting.
Once the GST Council works out the details of the GST laws, it will have to be approved in the Parliament in the winter session, which is expected to be reportedly moved ahead by fortnight and held in the first week of November, to meet the deadline of April next fiscal.
Two bills related to biggest tax reform will be taken up in the Parliament's next session – Central GST or CGST bill and the Integrated GST bill. States will approve their own GST bills.
Prashant Deshpande, partner, Deloitte Haskins & Sells LLP, said the "immediate agenda" of the Council would be to finalise the GST rate and exemptions; "without a fix on which the stakeholder consensus would be difficult to achieve."
Pratik Jain, leader - indirect tax, PwC India, also said implementation of GST from April 1, next fiscal would be contingent upon the speed at which the Council is able to build a consensus on issues such as rates, exemptions, dual control etc.
BMR & Associates LLP's Dimri said with the enforcement of section 12 of the Indian constitution (One Hundred and First Amendment) Act, 2016, the two months' clock for setting up of the GST Council has started ticking.
"As soon as the Council gets formed it will have a platter full of important and critically time-driven deliverables. The most important of them being reaching consensus amongst all states regarding several aspects of levy and administration of GST in India viz. tax rates, list of goods to be exempt / taxable on merit rates of GST, determining the threshold for taxable turnover for goods and services, and so on," he said.
The Constitutional amendment Bill for GST was passed in both Houses of the Parliament in the Monsoon Session this year after much delay. After being cleared there, it has been ratified by 17 states till now. It needed 15, or half of India's 29 states to approve it. Last week, it got the Presidential assent.