SHILLONG: The Meghalaya Cabinet has finally approved the Meghalaya Draft Goods and Service Tax (GST) Bill.
Speaking to media persons after the Cabinet meeting here on Monday, Chief Minister Mukul Sangma said the Bill would now be introduced in the special session of the Assembly.
“I have proposed a special session on Monday and I have written to the Governor and Speaker to convene the special session,” Sangma said and added that the State Government would maintain the timeline for rolling out the new tax regime, which is July 1 as per the discussion in the GST Council.
GST is an indirect tax throughout India to replace taxes levied by the central and various state governments. The introduction of GST is expected to be a step in the reforms of indirect taxation in India.
Asked about the benefits of the GST to a consuming state like Meghalaya, Sangma recalled that earlier all the states and the Centre had agreed that the states would be compensated if there is a reduced realisation of tax after passing on to the new regime. However, it was not legally binding.
Later, however, the states and the Centre decided on the empowered committee that it should be legally binding for the states to be compensated if there is reduced realization of tax following the new tax regime and therefore GST Compensation to the State Act was legislated.
The GST council has also calculated that 14 percent secular growth rate will be the basis for compensation over five years to those states whose tax realization will be reduced following the implementation of GST.
“The tax realisation after the rolling out of GST will be transparent,” Sangma said.
The GST is a proposed system of indirect taxation merging most of the existing taxes into a single system of taxation.
Introduced as ‘The Constitution (One Hundred and First Amendment) Act 2016’, the new tax regime would be a comprehensive indirect tax on manufacture, sale and consumption of goods and services throughout India to replace taxes levied separately by the central and state governments.
