Discuss the rationale for introducing Goods and Services Tax (GST) in India. Bring out critically the reasons for the delay in roll out for its regime.

Ending cascading

Excise could not be set off against state VAT, and CST could not be set off at all; GST gives input tax credit across the chain.

One national market

Entry tax, octroi and check posts fragmented trade, which a uniform levy would remove.

Wider base and growth

A dual GST lets both governments tax goods and services, and the NCAER study for the Thirteenth Finance Commission (2009) estimated a GDP gain of 0.9 to 1.7%.

Revenue fears

Producing states like Gujarat and Tamil Nadu feared losses under a destination tax, and unpaid CST compensation deepened distrust.

Fiscal autonomy

States opposed the proposed Dispute Settlement Authority as an intrusion on their power to tax.

Contested coverage

Petroleum, alcohol and entry tax remained sticking points while the Standing Committee examined the 2011 Bill.

Political and technical hurdles

The amendment needed a special majority and ratification by half the states, and the GST Network was set up only in 2013.