August 2017 News
GoI Extends Tax Exemption For JK Industries Till March 202716 August 2017
New Delhi: Industries in the north eastern and Himalayan states including Jammu and Kashmir will continue to get tax exemption till March 2027, albeit as refund, under the current GST regime which was rolled out on July 1, Union Finance Minister Arun Jaitley said Wednesday. 'Within the framework of the GST Act each industry will be entitled to its own refund mechanism during this particular period (March 31, 2027),' he said after the Cabinet meeting headed by Prime Minister Narendra Modi. Industries in the north eastern and Himalayan states of Jammu and Kashmir, Himachal Pradesh and Uttarakhand under the previous excise regime used to get 10-year exemption, he said. As per the scheme, industries which commenced operations during the period got excise tax holiday for 10 years, he said, adding that there is a separate residuary period for every industry because of commencement of production and their consequent entitlement of 10 year exemption. Under the new Goods and Services Tax (GST) regime, there is no provision for exemption but there is one section under the Act which permits refunds. 'Therefore, refund would be permitted through DBT. The sunset clause of these exemption has been extended to 2027. 4,284 industrial establishment will entitled to this benefit. Budgetary provision for this Rs 27,413 crore,' he said. The Government of India (GoI) was implementing North East Industrial and Investment Promotion Policy (NEIIPP) 2007 for North Eastern states including Sikkim and package for special category states for Jammu and Kashmir, Uttarakhand and Himachal Pradesh to promote industrialization. One of the benefits of the NEIIPP 2007 and Package for Special Category States was excise duty exemption for first 10 years after commencement of commercial production. Upon repeal of the Central Excise duty laws, the GoI has decided to pay a budgetary support equal to the central share of the cash component of CGST and IGST paid by the affected eligible industrial units. The support shall be available for the residual period (ten years from the date of the commercial production) in the States of North Eastern region and Himalayan States. DIPP will notify the Scheme, including detailed operational guidelines for implementation of the scheme within 6 weeks. It is estimated that total number of 4284 eligible units located in the States of Jammu and Kashmir, Uttarakhand, Himachal Pradesh and North Eastern States including Sikkim would benefit from the above scheme.