Bhubaneswar, Aug. 2: The BJD has decided to help the BJP-led NDA government get the crucial Goods and Services Tax (GST) Bill passed in the Rajya Sabha despite its current stand-off with the Centre over the Mahanadi water dispute.

The bill, widely perceived to be the most comprehensive tax reforms legislation by the Narendra Modi government, will face an acid test tomorrow when it is introduced in the Upper House where the NDA lacks majority.

Explaining the BJD's stand, Odisha finance minister Pradeep Amat told The Telegraph: "We support the GST bill because it will help bring uniformity in the tax structure. Tax on a product will be the same throughout the country. This will help stop tax pilferage." He, however, reiterated the state's demand for green tax keeping in view the adverse environmental impact of mining activities in various areas.

"Under the GST, the destination principle applies and the mineral producing states that get polluted do not get any part of the revenue. It is only the consuming state that gets the tax revenue whereas people in the producing state suffers the consequences of pollution," the state finance minister said, hoping that NDA government would being suitable amendments to the GST Bill and accommodate Odisha's demand.

Amat said that in view of the adverse environmental impact of mining, the state had proposed to levy an additional non-rebatable cess under GST, which the state would be empowered to levy subject to the framing of suitable guidelines after consultation with the proposed GST council.

Party's leader in the Lok Sabha Bhartuhari Mahatab echoed the same view. He told The Telegraph: "We are supporting the bill. But during the discussion tomorrow, we will argue in favour of a green cess because the adverse impact of mining had to be compensated."

BJD's Rajya Sabha member Bhaskar Rao said the party members would meet tomorrow morning and take a call on the issue.

Amat further said that the Centre had agreed to compensate Odisha's revenue loss on account of the initial problems that might be encountered in standardising the tax structure and making it uniform throughout the country. "We are yet to ascertain the exact loss that we would incur on this account. But, this would be made good by the central government," said Amat.

The minister said that Odisha had also sought compensation from the Centre for losses it had incurred in the past on account of reduction in central sales tax. "We have claimed Rs 2,755.36 crore as compensation for the loss on account of CST reduction from 2007-08 to 2011-12. We hope that we will get the amount soon," he said.

This is not the first time that the BJD, which seems to have a love-hate relationship with the Narendra Modi government, has extended its support to the NDA government on a crucial issue. In March last year, it has backed the controversial MMDR Amendment Bill in the Rajya Sabha in a move that had drawn flak from various political quarters.