SRINAGAR: Amid opposition from opposition members, Jammu and Kashmir legislature on Wednesday adopted a resolution on implementing Goods and Services Tax (GST) in the State.
The resolution was adopted in Assembly today by voice vote after two days of discussion. However, the opposition NC, Congress and independent MLA from Valley including CPI(M) protested against extending the new tax regime to the state in its present form.
It was also adopted in upper house of the State legislature by a voice vote.
After passage of resolution in the State legislature, the state cabinet met under the chairmanship of Chief Minister Mehbooba Mufti to give to give concurrence to 101st amendment act for implementation of GST in the State.
The passage of the resolution in the legislature and its concurrence by the state cabinet will pave way for implementation of the new tax regime in the State, which was only state in the country not to implement the GST rolled on July 1.
The resolution was moved by Finance Minister Haseeb Drabu yesterday.
Responding to the concerns of the legislators, he said under no circumstances will the State government amend the Section 5 of Constitution of J&K which gives it special taxation powers.
Reacting to the demand of opposition to bring a separate GST law for J&K, Drabu said alternative law will require amending constitution of J&K and of India. "Amending Section 5 of J&K Constitution will open Pandora's Box. Instead, what we are proposing is that the GST Council must come within the ambit of Article 370”.
"We are proposing that the Article 370 shall not be compromised in any way through the Presidential Order. The GST Council should not be a way to subvert the process and enough safeguards are built to empower the constituents of J&K in the Council. Besides, the exclusive powers of the State to tax and the Consolidated Fund of J&K shall not be impaired," he said.
After the resolution was passed, Drabu termed it a statement of a principle. "The sense of the House is that no one has issues with GST per se. There might be differences with modalities of applicability, which is why we want this law to be backed by the State Government and legislative process so as to prevent any harm to the consumers and trade without compromising on the State’s special position".
Seeking to allay the fears of business community, he said industry exemptions and tax remissions will continue both from the Centre and the State Government under the new tax regime.
Hitting out at opposition for making an issue out of a non-issue, he said the GST is the biggest democratization of public funds in the world and J&K, being a consumer state, will immensely benefit from it.
"We are not touching the Constitution of J&K, so where is the question of violation of basic structure of constitution? Under previous regimes, 94 out of 97 items in union lists have been made to apply to J&K,” the FM said.
Drabu said Article 370, which gives special status to J&K under Indian Constitution, should be protected and used for development of the state and for the empowerment of people.
"Instead, it is being used as a tool to whip up political passions and draw political mileage. It is being used for creating fake controversies,” he said.
"If the GST overwrites Article 370 of Indian constitution or section 5 of J&K constitution) I will not come back to this House," Drabu said.
National Conference leader and MLA Khanyar, Ali Mohammad Sagar said extending GST will erode the special status of the State.
He said New Delhi has never fulfilled the promises made to people of State and this (GST) case will meet the same fate.
Opposition NC working president and former chief minister Omar Abdullah termed passage of resolution on GST in State Assembly as a sham and said there was absolutely no clarity on constitutional safeguards for the state.
A Congress spokesman described the special assembly session on GST as a mere eye wash on part of PDP-BJP government, which remained on tenterhooks to pass the new tax regime in the State by staging dramas and enacting different stories in this regard
“The PDP-BJP coalition government had crossed all limits of betrayal,” he said.