GST and the politics of opportunism ( GS 3 , Taxation ,Livemint )

Prime Minister Narendra Modi’s stance on the goods and services tax (GST) at the all-party meet on Sunday was laudably statesmanlike. In his words, “GST is of national importance. Issue is not about which government gets credit.” It would not be much of a stretch to read an underlying—and understandable—frustration in that message. Getting the GST bill passed has been at the top of his agenda for two years now, but he has been stymied repeatedly. The reason for that, however, lies in his statement. To say that the GST is not about perception and credit is to misrepresent recent history.
The GST’s transformational benefits—the increased efficiencies of a common Indian market and a simplified taxation regime—have been written and spoken about at length. Arguing against it on core economic grounds is all but impossible. And yet, opposition parties with the Congress at the forefront have repeatedly pushed back against it. As the legislation has been delayed again and yet again, that refrain—Modi’s call to rise above the politics of cynicism and pull together for the national weal—has come more frequently.
The problem, of course, is that the national interest has shown itself to be a particularly mutable concept over the past decade and change. The Congress’s stand against the GST may revolve around the details of its implementation, but the motive is transparently political. This is a party that had championed the tax for the duration of both United Progressive Alliance administrations—a period when the GST’s current champion, the Bharatiya Janata Party (BJP), had been its fiercest critic. The idea may have originated during Atal Bihari Vajpayee’s time at the helm, but that didn’t stop Modi—then Gujarat chief minister—among others from opposing it at every turn.
Thus, if the Congress walked out of Lok Sabha when the constitutional amendment bill for the Lok Sabha was introduced in the 2015 budget session, it was following the precedent set by the BJP during UPA-II. Switch one word in the then prime minister Manmohan Singh’s lament in 2011 that “This is the reform which is needed… But the opposition parties, particularly the BJP, have taken a hostile attitude…” and it could be Modi circa 2015.
Given this, it isn’t particularly surprising that the Congress would attempt to pay the BJP back in kind. Nor is the GST the only major issue that has been the victim of this politics of opportunism. The India-US civil nuclear agreement and the liberalization of the insurance sector—areas where a wealth of expert opinion made the way forward clear—both encountered opposition by the major parties that would go on to back them when in power.
The cyclical nature of this kind of politics makes its negative effects manifestly clear. Petty obstructionism when out of power means facing the same when the roles are reversed. In the meantime, the opportunity costs of critical legislation remaining in limbo mount. If the BJP or the Congress is to break the cycle, it will have to display uncharacteristic political imagination and courage.
It’s a tall order, but the moment is right for the Congress to choose that option. Recent victories in Arunachal Pradesh and Uttarakhand via judicial verdicts notwithstanding, it is in perhaps the most precarious position of its long existence. Its strength in the Lok Sabha is minimal and its Rajya Sabha advantage is set to erode over the next few years. More of the same—fighting a rearguard action on the GST and on other issues using its current tactics—is unlikely to change its trajectory. It has little to lose by changing tack and meeting Modi’s belated statesmanship with a similar approach.
Unfortunately, it is more likely that if it cooperates on the tax—with the softening of its stance in the run-up to the monsoon session, this is a possibility—it will be entirely a consequence of the BJP successfully wooing regional parties on the issue and thereby isolating the Congress to the point where continuing to block the GST would be counterproductive as far as public perception goes.
Don’t count on statesmanship trumping the petty exigences of politics just yet.


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