SHILLONG: The State Assembly on Monday passed the Meghalaya Goods and Services Tax Bill 2017 to pave way for the implementation of the new tax regime from July 1.
After the Bill was introduced, several legislators sought clarity on the matter.
In his reply, Taxation Minister Zenith Sangma said GST will benefit consumer states like Meghalaya compared to the manufacturing states. (Tax table on page 10)
“Once the GST is implemented, the manufacturing states will lose revenue whereas consumer states like Meghalaya will benefit and the cascading effects of various taxes will come to an end,” he said.
However, the loss-making states will be compensated by the Centre for five years with the base year of 2015-16.
He said the poorer section of the society will benefit as there is no tax on food grain.
He said though the Centre wanted to put 12 per cent tax on dry fish, Meghalaya and Manipur fought for reduction in the tax and hence the GST council fixed 5 per cent.
As far as arecanut is concerned, while there is no tax on green arecanuts, 5 per cent is taxed for dried ones and 28 per cent for other byproducts like gutkha.
Besides, the tax imposed on broom sticks is 5 per cent.
On the shifting of offices of the Central Excise, Sangma said this will not have any impact on the implementation of GST.
Regarding invoice rules, the Taxation minister said up to purchase of Rs 50,000, the name and address of a buyer as invoice will not figure. “However, it is a matter of concern as for example a buyer to escape from invoice can make multiple purchases from several parts of Assam,” Sangma said.
The minister said the threshold limit to pay tax by dealers has been fixed at Rs 10 lakh. “Once the GST is implemented, a dealer who has a turnover of up to Rs 10 lakh will not be under the tax net,” Sangma said, adding that out of 30,000 dealers in Meghalaya only 4,500 will be under tax net.
He said the next meeting of the GST council will be held on June 18 and by September, all the States will be bound to implement GST.
According to Sangma, it was way back in 2000 that the empowered committee of finance ministers of various states met and discussed the matters related to GST following which the GST council was constituted to follow up the revolutionary idea of single tax in a single place.
On the challenges which Meghalaya will face, Sangma said that the internet facility will be a problem since BSNL coverage is limited.
He, however, said help of private companies will be sought for the digital connectivity and GST council has also engaged GSTN.
Earlier, participating in the discussion, Paul Lyngdoh of UDP wanted to know whether the State Government is fully equipped to start GST regime.
He also enquired about the stand of the government regarding the Centre’s move to shift the headquarters of Central Excise and Customs to Guwahati following the GST implementation.
K.P Pangniang of HSPDP said the government should improve internet connectivity besides providing orientation to the stakeholders before implementing GST, otherwise the problems which occurred during demonetisation will be repeated.
He said while puja items are exempted from tax, there is high tax on school books, biscuits and others.
Jemino Mawthoh of UDP also wanted to know about the State’s preparedness as there is a need to improve internet connectivity.
Saleng Sangma (Independent) said there should be clarity on share of taxes from the Centre to the State and district councils.
James Sangma of NPP said there is a need to exempt broom industry from taxation.
Since broom is a forest produce, it was exempted earlier, James said, while urging the State Government to take up the matter with the Centre.
Diosstarness Jyndiang of HSPDP said small traders may be affected by the GST regime.
Titosstarwell Chyne of UDP wanted to know from the government as to whether check gates in the inter-state border will impose tax for goods transported to Meghalaya from other states.