Jammu KashmirJ&K will have to pass special laws to make GST applicable

J&K will have to pass special laws to make GST applicable

Date:

J&K will have to pass special laws to make GST applicable

NEW DELHI:   & will have to pass special laws to be able to implement the Goods and Services Tax as its current Constitutional status does not mandate the applicability of the new indirect tax reform in the state.

 

The Central-GST (CGST) and Integrated-GST (IGST) Bills, introduced in the Lok Sabha yesterday as part of last legislative exercise in Parliament before the tax regime is rolled out from July 1, extend to the whole of expect J&K.

 

While service tax is levied all over the country since 1994, it is not applicable in J&K. The state levies its own taxes for services provided in the state.

 

This is because Article 370 of the Constitution grants special autonomous status to the state and Parliament of India has power to make laws only on , external affairs and communication related matters of the state.

 

As a result, once CGST and IGST bills are passed by Parliament, the J&K Assembly will have to pass a legislation saying the two laws are applicable to them, official sources said.

 

This approval by the state assembly will be in addition to the requirement of all states to approve the State-GST law.

 

Once J&K Assembly passes the laws, the Union Government will have to amend CGST and IGST laws and delete the phrases that they do not apply to the state, sources added.

 

Deletion of the phrase will make the laws applicable to the state.

 

The bills introduced by Finance Minister Arun Jaitley in Lok Sabha yesterday stated that they extend “to the whole of India except the state of Jammu and Kashmir.”

 

A separate law for levy of cess on select goods to make up for a kitty to compensate states for any loss of revenue in first five years of GST rollout extends, however, to whole of India including Jammu and Kashmir.

 

The GST (Compensation to States) Bill “extends to the whole of India,” the legislation introduced by Jaitley said.

 

The approval by Parliament and state assemblies to these laws will pave the way replacing the current patchwork of national, state and local levies with a single, unified value added tax system and integrating India as one market.

 

The CGST bill will amalgamate all the indirect central government levies like sales tax, service tax, excise duty, additional customs duty (Countervailing Duty), special additional duty of customs, surcharges and cesses.

 

CGST provides for a maximum tax of 20 per cent. A similar tax will be levied by states through a separate State-GST law.

 

Actual rates would, however, be a four-tier tax structure of 5, 12, 18 and 28 per cent as approved by the GST Council. The peak rate of 40 per cent is only an enabling provision for financial emergencies.

 

The Bill on Integrated-GST is for levy and collection by the Centre on inter-state supply of goods and services.

 

The IGST law provides for a maximum tax of 40 per cent. (AGENCIES)

Northlines
Northlines
The Northlines is an independent source on the Web for news, facts and figures relating to Jammu, Kashmir and Ladakh and its neighbourhood.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Share post:

Popular

More like this
Related

10 Dead as Passenger Taxi Skids off Jammu-Srinagar Highway in Ramban

An accident on the Jammu-Srinagar National Highway today has...

Missing girl from Reasi recovered within 2 days: Police

Jammu Tawi, Mar 28: The district police Reasi recovered...

PM Modi arriving in J&K for 3rd time this year

HM Amit Shah, DM Rajnath also among the Star...

JK Govt earns Rs 544 crore from land registrations in just one year

Srinagar, Mar 28: Land revenues have seen a remarkable...