‘JK will become isolated economy if GST not implemented’

Govt calls special assembly session on June 17

Neyaz Elahi

SRINAGAR: The Jammu and Kashmir government Wednesday said that it will hold a special session on the State Assembly to debate its proposed law on Goods and Services Tax (GST) to “protect” the state’s constitutional position on taxing services.

The Assembly Session will be held on June 17 of this month. This was stated by Finance Minister Dr Haseeb Drabu during a press conference here in Kashmir capital Srinagar.

Drabu hinted that GST will be implemented in Jammu and Kashmir as according to him it will save traders from taxation burden. “If we don’t implement GST in Jammu and Kashmir, there will be no profitability. J&K will become isolated economy if GST is not extended to the State,” he said.

“A special session of the Assembly would be convened to “approve the GST law which will be in consonance with the state’s existing constitutional position,” he said and added that other states of India draw their power of taxing from Article 42 of the Constitution of India, J&K draws this power from section 5 of the J&K Constitution. “Accordingly changes have been proposed in the draft bill in all the three categories—SGST, CGST and IGST keeping in view the state’s constitutional position,” Drabu said.

He said that the extension of GST has three aspects- constitutional, administrative and legal. “All these aspects will be discussed in the assembly,” he said.

Some are claiming that extension of GST to J&K will compromise the State’s autonomy. “We need to understand that it is a unified tax and modified version of VAT. The big issue is in the terms of exemptions. For J&K, exemptions in form of reimbursement will continue,” he said and added that he has held couple of round-tables with traders’ community.

The GST is a value added tax and is proposed to be a comprehensive indirect tax levied on manufacture, sale and consumption of goods as well as services by the Central and State governments. The State is among 8 States which are yet to ratify the Goods and Service Tax.