With the implementation of the goods and services tax from July 1, the business community of Jammu and Kashmir are under a lot of pressure, fearing financial autonomy crisis and huge losses. The final tax rates will be decided on May 18 and 19 when Arun Jaitley, will be visiting Srinagar for the crucial GST Council meeting.
The business community has claimed that the government has done nothing to create awareness among the stakeholders. There is a feeling of fear and chaos in the business community because, though the J&K enjoys a special status in the constitution of India and have to draft its own GST laws still the J&K government has decided to convene a special assembly session to pass laws for the implementation of GST in the state. In his statement to ET, Mushtaq Ahmad Wani, president of Kashmir Chamber of Commerce and Industry said “The government is doing nothing to allay the fears of business community. If they finalize the rates in upcoming meeting, what will be left to the state legislature? We cannot compromise our financial autonomy.”
Javed Burza, president of Kashmir Hotel and Restaurant Owners Federation stated that “We have no idea about GST. We just understand that things will be expensive. But I don’t think we have any financial autonomy left.” The business communities are being kept in complete darkness as they do not know whether the exemptions and special rebates applicable in the state will continue or not.
During an awareness session held at Srinagar Customs and Central Excise Division, the assistant commissioner of customs and central excise said “Flexible band of rates decided by the GST council can satisfy the special status of the state. As per the reports, GST law will increase the revenue of J&K which is largely a consumer state.” He also added that at present J&K government taxes only 26 services.
Another government official stated that, like in the European Union, on the condition of anonymity, there could be an opting out clause in GST and this would also take care of the special status of the state.
The president of Jammu Chamber of Commerce and Industry said that, “There will be chaos and huge losses. Nobody knows what to do. We have to see how industries would be compensated under the new laws.” He also added that GST would be welcomed but the business community is still not prepared for the implementation of the new tax regime.
The businessmen have started for the registration of GST, as the J&K government has informally asked them to do so, but the traders are still scared of the financial repercussions.