The Indian government’s plans to introduce a new implementation Bill and to replace the existing Indian VAT and CENVAT regimes with a new Goods & Services Tax (GST) look likely to be delayed again since the States are seeking to re-open discussions on the rates for petroleum and alcohol.
As India has a federal system and the states raise considerable amounts of revenue from indirect taxes the implementation of GST on an India-wide basis requires discussions and agreements at State and federal level.
There was an agreement allowing GST to be charged on petrol and alcohol, plus an additional State-levy tax if required. The States are now seeking re-negotiations, looking to remove both items from the GST net.
