Excelsior Correspondent
JAMMU, June 7: As the State Cabinet headed by Chief Minister Mehbooba Mufti today approved draft legislation on Goods and Services Tax (GST), the Act will be debated in both Houses of the Legislature, whose Special Session has been called by the Government from June 17 to 20, and passed.
Finance Minister Dr Haseeb Drabu gave a detailed presentation to the Cabinet today on all aspects of GST.
Legislative Assembly Speaker Kavinder Gupta told the Excelsior that Special Session of the Assembly has been convened from June 17 to 20. He said the Session will be exclusively devoted to discussion and passage of the GST bill and there will be no other item on Agenda of the House.
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“We will go for double sittings to facilitate all members to discuss GST in detail before its approval,” Gupta said, adding that first sitting of the House on June 17 will be devoted to Obituary Reference and the GST bill will be introduced by the Finance Minister in the second sitting.
With June 18 being Sunday, the Assembly will debate GST on June 17, 19 and first sitting of June 20 while the Finance Minister would reply to the bill in second sitting on June 20 after which the bill would be put to vote for passing.
The Legislative Council could sit for an additional day to pass the GST bill, sources said.
Meanwhile, the State Cabinet which met here today under the chairmanship of Chief Minister, Mehbooba Mufti approved the draft Legislation on GST to be introduced in the special session of the State Legislature. The draft legislation would also lay a roadmap for the implementation of GST in the State.
Minister for Finance, Dr Haseeb Drabu made a detailed presentation before the cabinet covering all aspects of GST. He informed the Cabinet that all major decisions regarding implementation of GST in the country have been taken by the GST Council and GST will be rolled out throughout the country from July 1. He informed the cabinet that the interests of the state and special constitutional provisions so far as the State of Jammu and Kashmir is concerned, have been taken care of and protected.
Dr Drabu informed the Cabinet that the Constitutional (Amendment) Act passed by the Parliament is not applicable to the State of Jammu and Kashmir and it has been left to the State Legislature to look into its various provisions and take decisions accordingly. Dr Drabu also referred to the statement made by the Union Finance Minister, Arun Jaitley in Srinagar while attending the 14th GST Council meeting that “the State Legislature is competent to take all decisions related to the implementation of the GST”.
Dr Drabu informed the Cabinet that only the relevant provisions of the 101st Constitutional Amendment Act will be presented before the State Legislature for ratification. He further apprised the Cabinet that the implementation of GST in no way infringes upon Article 370 or the Constitution of the State of Jammu and Kashmir.
The Finance Minister apprised the Cabinet that Section 5 of the Constitution of Jammu and Kashmir will remain untouched from where the State Government derives the financial autonomy and power of taxing. This means that the State Government shall remain free to levy any additional tax or new taxes on such commodities which doesn’t come under the preview of GST.
The Finance Minister further informed the Cabinet that out of three components of GST, two of them namely, IGST and CGST have already been existing and remaining applied to the State of Jammu and Kashmir in the form of CST and Central Excise Tax. For replacement of VAT with SGST, the State Government has drafted its own legislation which will be presented before the State Legislature for approval.
Dr Drabu also informed the Cabinet that the State of Jammu and Kashmir has successfully negotiated to protect the interests of industries and SME sectors of the State which enjoys tax exemption under the State Industrial Policy. He informed the Cabinet that these exemptions or benefits to the industry will continue in the form of reimbursement.
The Finance Minister apprised the Cabinet that unlike other States, the dealers based in the State will be subject to the administrative control and audits and inspection by the State Tax Administration. With GST being a self assessed based tax regime, only 5% of dealers based on a risk assessment will be subject to audit every year which will give a major relief to the business community.
The Finance Minister informed the Cabinet that all tax disputes arising in respect of dealers based in the State will be decided by the Tribunal set up by the State Government unlike in the case of other States.
The Cabinet noted with satisfaction that cross LoC trade in its present form will continue un-effected by the roll out of GST.
The Finance Minister also informed the Cabinet that “we have retained the right to review the experiences gained from implementation of GST after the Compensation period is over”.
The Cabinet noted that the J&K being the consuming State, the GST will be beneficial to consumers, producers in terms of cheaper inputs and the State Government in terms of higher revenue.
The Finance Minister also apprised the Cabinet that the tax rates of almost 95% of commodities have actually gone down after accounting for Input Credits and Cascading effect. He further informed the Cabinet that the dealers having turnover of less than Rs.10 lakhs need not file tax returns and those having turnover less than Rs 50 lakhs can avail the benefits of the Composition scheme.
The Cabinet noted that the non roll out of GST in the State of J&K will cause immense harm to the State finances and business community. Non implementation will virtually stall the trade and business with other parts of the Country. The consumers will face immense hardships in view of significantly high costs of all goods and services. Manufacturing industry will not receive input credit and thereby will become uncompetitive. Needless to say that there will be heavy loss of revenue to the State Exchequer.
The Finance Minister apprised the Cabinet regarding the preparedness of the State administration for implementation of the GST from July 1, 2017. He informed that all required IT infrastructure has already been put in place. The provisional ID’s of all existing dealers have been generated and the data in respect of almost seven thousand dealers have been migrated to the GST Portal. The GST Portal is now continuously open for migration of the existing and as well as registration of new dealers.
The Finance Minister also informed the Cabinet that the Commercial Taxes Department have already organized various seminars and training camps in the State and in the coming days the same will be done on daily basis. The robust training programme educating the dealers have been put in place and all dealers can avail the same in the office of Commissioner Commercial Taxes.
The Cabinet while approving the draft legislation also directed the Finance Department to consult more legal luminaries as may be required and thereafter the legislation vetted by the Law Department before the same is introduced in the State Legislature for accuracy.
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