President Pranab Mukherjee and Prime Minister Narendra Modi hit a symbolic button at midnight on Friday, to signal the launch of India’s Goods and Services Tax, a massive overhaul of India’s indirect tax regime. “With the launch of GST, we are ensuring the progress of the country,” said Modi at the event in Parliament’s Central Hall. “The launch of GST is not the achievement of a particular party or government, it is a collective achievement.”
The gala event was meant to signal the roll-out of the new tax regime, which replaces all indirect taxes in various states with a common tax code that will be uniform nation-wide. GST alters the structure of the Indian Union, and required a Constitutional Amendment – passed last year – to come into being. The new system is built around the Goods and Services Tax Council, an institution that features representation from all the states as well as the Centre, which is expected to unanimously make decisions on the way indirect taxes ought to apply in India.
“In a few minutes from now, we will have a unitary tax in the country. It has been a 14-year journey, which began in Kolkata,” President Mukherjee said in a speech after the prime minister’s address. “The GST launch is momentous, it is significant for me because I worked for its implementation during my time as finance minister of this country.”
Finance Minister Arun Jaitley spoke before both Modi and Mukherjee, giving attendees and the wider Indian public a sense of the history of the tax, which has been almost two decades in the works. Modi then went on to tell people that he could simplify the new tax regime, even though the last few months have been filled with complex financial discussions about what it will mean for the country.
“GST is Good and Simple Tax,” Modi said. “There are a lot of complex words attached to GST, but understanding it is very simple: It will help the poor of the country.”
The event was attended by most Members of Parliament, barring those of the Congress, Dravid Munnetra Kazhagam, Trinamool Congress and the Left, who boycotted the event for a number of reasons. Most conspicuous in his absence was former Prime Minister Manmohan Singh, who had been invited to share the dais with Modi, Mukherjee and others, including fellow former Prime Minister Deve Gowda.