HYDERABAD: Like farmers, big industrialists too are likely to get cash transferred into their bank accounts from the government soon.
With no provision in the Goods and Services Tax (GST) for any tax exemption, the state government has started finding alternative measures on providing tax incentives to industrialists in order to make them invest in the state. According to sources, the state will deposit tax incentives directly into the bank accounts of industrialists.
As part of the industrial policy, the state government has already given VAT exemption for five years to some categories of industries. The VAT exemption is around `700 to 800 crore. “We have no provision for any exemption of tax or tax concession in GST. But, state government has decided to keep its assurance to industrialists. Once they pay their taxes, the state is likely to transfer money to their bank accounts,” a senior official in the finance department told Express here on Thursday.
According to official sources, six departments would not get regular tax collections due to the introduction of GST.
For example, urban local bodies, which were collecting entertainment tax (ET), can no longer collect the tax as ET is not covered by GST.
Likewise, the GHMC will lose ET on big hoardings in the city and officials are working on how to compensate the civic body.
“With the implementation of GST, some Acts relating to taxes will subsume in GST. Thus, we are exploring alternatives to realise required money,” an official said.
Liquor is not included in GST and left to the states. But suppliers of bottles will come under GST. But the liquor manufacturer, who uses bottles, will not get input tax credit as provided in GST. “We are also working on how to address this issue,” an official disclosed.