Guwahati: Assam became the 11th state in the country to adopt the Goods and Services Tax (GST) Bill with the state Assembly unanimously passing the Assam Goods and Services Tax (GST) Bill, 2017 on Thursday, on the last day of a three-day special session called for its passage.
Placing the Bill before the Assembly, Assam Finance minister Himanta Biswa Sharma claimed consumer states like Assam will benefit under GST regime.
He said, “As long as we are a consumer state, we will gain. GST is a tax reformation measure. The country, each state and all consumer will profit. It is win-win for all.”
The minister said being a consumer state, Assam stood to benefit. Moreover, tax enforcement, which was earlier lax, will improve and ‘no tax on tax’ will be levied.
Addressing apprehension over abolishment of incentives to industries, Sharma said, “The industrial policy will remain the same. Earlier it was exemption model, now it will be reimbursement model.”
Among the features of the Assam GST Bill, 2017, are PAN-based registration, electronic return filing, tax deduction at source and tax collection at source.
An anti-profiteering provision has been proposed in order to ensure that business passes on the benefit of reduced tax incidence on goods or services or both to the consumers.
Elaborate transitional provisions have been proposed for smooth transition of existing tax payers to the GST regime.
As it would not be possible to continue with present industries exemption/remission scheme in their present form, the Bill proposed conversion of these schemes into some kind of cash subsidy schemes.
Upon introduction of GST, the tax revenue currently collected under VAT, CST, entry tax, entertainment tax and luxury tax will get pooled into GST, except VAT and CST on liquor for human consumption and five petroleum products.
Due to such subsumation of taxes, inclusion of tobacco products under GST and shrinking of taxable base, the state might loss revenue in the initial years, which is expected to be offset to a great extent by taxing the service sector of the state, the most buoyant source of revenue.
Further, the state will receive compensation for a period of five years for the loss of revenue on recommendation of the GST Council.
