Touting it as the "single biggest tax reform" since independence, Finance Minister Arun Jaitley today said the GST law will subsume all indirect levies including entry tax from April, 2016, which will ensure seamless flow of goods and services across the country.

The GST, which was hammered out after series of meetings with the states, is a "win-win" for both Centre and States and will provide for levy of 1 per cent additional tax by states for inter-state transfer of goods for two years.

"GST will ensure seamless transfer of goods and services, absence of Inspector Raj and no tax on tax," Jaitley told reporters soon after tabling the 122nd Constitution Amendment Bill in the Lok Sabha.

The Bill will be considered for passing in the Budget session of Parliament beginning February, the Minister said, adding he did not feel the necessity of the legislation being referred again to a Standing Committee.

Under the provisions of the Bill, petroleum goods will be part of the GST but they will be levied at zero rate, implying that the states will continue to levy VAT while Centre will levy excise duty for initial few years.

Thereafter, it will be fully subsumed in the GST, the date of which will be set by the GST Council, which is made up of two third of states and the remaining of Centre.

The states, however, will continue to levy taxes on alcohol as is the practice now.

Explaining the Bill, Jaitley said that states will be allowed to levy 1 per cent additional tax for two years.

The GST will be a "win-win situation for Centre and states and is the single biggest reform after 1947", he said.

Jaitley said: "This 1 per cent tax and the compensation mechanism for 5 years during the transition phase will be adequate, We do not envisage revenue loss to the states."

As regards the compensation to the states on account of any possible loss of revenue following implementation of the GST, Jaitley said there will be 100 per cent compensation in first three years, 75 per cent in the fourth year and 50 per cent in the fifth year.

As regards the impact on prices of GST implementation, Revenue Secretary Shaktikanta Das said "prices will remain stable".

"The general expectation (from GST) is that there will be no tax on tax. There will be no cascading effect. So the general expectation is that over a period of time, the prices will stabilise. There is a general expectation that there will be a buoyancy in the GDP growth of the country also," he said.

Jaitley said compensation of past Central Sales Tax (CST) dues to states will be done in instalment.

"I do intend to provide for an instalment in this financial year which goes on to March 31," the minister said, adding that he will seek Supplementary Grants in the Budget session for the purpose.

The composition of the GST Council, which is to decide the tax rate as well as the date of subsuming petroleum taxes in the new regime, is reflective of the "concept of cooperative federalism", he said.

"Two-third of representation will be from states and one-third will be from Centre and all decision will require 75 per cent of votes to be cleared," he said.

GST will subsume central taxes like Central Excise Duty, Additional Excise Duties, Service Tax, Additional Customs Duty (CVD) and Special Additional Duty of Customs (SAD).

State level, taxes like VAT/Sales Tax, Central Sales Tax, Entertainment Tax, Octroi and Entry Tax, Purchase Tax and Luxury Tax, among others would be subsumed in GST.

Both Centre and States will simultaneously levy GST across the value chain.

He further said that the revenue of the states will go up as they will be allowed to levy taxes on services in addition to goods.