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The GST Constitutional Amendment Bill is now being examined by the Select Committee of the Rajya Sabha. This article highlights some issues relating to the Bill, which need to be considered by the Select Committee. In an effort to bring the states on board, the Bill has proposed both a diluted GST framework and a weak implementation structure. Excluding alcohol, real estate and electricity duty will attenuate the GST base and inflate the Revenue Neutral Rate. The levy of the proposed additional tax based upon origin will impose barriers to trade, result in tax cascading, and hamper competitiveness of Indian industry. The Bill does not bring closure to the debate on the GST design and implementation. This is left to the GST Council to be set up in the future. In such a case, the GST Council should have been empowered to enforce its recommendations, but this has not been done. Four clauses of the Bill do not amend the Constitution at all and their presence in the Bill requires review. A number of other drafting changes are necessary in the Bill consistent with legal requirements.

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