The Lok Sabha yesterday passed two bills extending Central Goods and Services Tax (CGST) and Integrated Goods and Services Tax (IGST) to Jammu and Kashmir.
The Finance Minister Arun Jaitley said that special status of Jammu and Kashmir was “never meant to create economic impediment” as he maintained that the GST is in the larger interest of traders and consumers of Jammu and Kashmir
The Central Goods and Services Tax (Extension to Jammu and Kashmir) Bill and the Integrated Goods and Services Tax (Extension to Jammu and Kashmir) Bill passed by the House by a voice vote are aimed at giving effect to the formal amendments required in Central GST (CGST) and Integrated GST (IGST) Acts by removing the exemption that was carved out for J&K.
“If they (J&K) didn’t integrate, then the traders would not have got input credit and the tax on final products would have been higher… That would have made products costlier and consumers would have to pay more,” the Jaitley said in the debate.
“J&K is a consumer state and GST being a destination- based tax, the revenues of the state would increase,”.
He also added that if GST was not put in place in J&K, then customers would prefer to buy products like cars and refrigerators from outside the state, thus causing economic loss to traders and customers of the state.
The CGST (Extension to Jammu and Kashmir) Bill, 2017 provides for levy of the GST on goods sold and services rendered in the state while the IGST (Extension to Jammu and Kashmir) Bill, 2017 seeks to levy the tax on inter-state movement of goods.
Earlier President issued an ordinance extending the provisions to the state. The J&K assembly then passed the Jammu and Kashmir Goods and Services Tax Act, 2017 which came into force on July 8, 2017.
