The GST bill, intends to convert 29 states into a single market through a new indirect tax regime.
Among the amendments approved include the abolishment of a 1 percent additional tax levy which was demanded by the Opposition parties led by Congress.
It also approved the compensation for states for five years instead of the earlier ‘up to five years as proposed in the draft GST bill.
The Constitutional Bill will include that dispute resolution will be handled by the GST council.
The Cabinet also dropped a 1 percent manufacturing tax.
The GST was supposed to be implemented from April 1, 2016 but strong opposition from Congress led to the delay.
The Bill has already been passed by the lower house of Parliament and awaits the passage from the Upper House. It requires two-thirds vote to get passed from both houses.
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