Govt extends tax break for industry in hilly states till 2027
The Cabinet Committee on Economic Affairs gave approval to the Scheme of providing budgetary support under the GST regime for the eligible industrial units in Jammu and Kashmir, Uttarakhand, Himachal Pradesh and north eastern states including Sikkim.Updated: Aug 16, 2017 20:06 IST
Press Trust of India, New Delhi
Industries in the north eastern and Himalayan states will continue to get tax exemption till March 2027, albeit as refund, under the current Goods and Services Tax (GST) regime which was rolled out on July 1, finance minister Arun Jaitley said on 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.
The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, has given approval to the Scheme of providing budgetary support under the GST regime for the eligible industrial units in Jammu and Kashmir, Uttarakhand, Himachal Pradesh and north eastern states including Sikkim, he said.
The support shall be available for the residual period (10 years from the date of the commercial production) in the States of North Eastern region and Himalayan States, he said.
DIPP will notify the scheme, including detailed operational guidelines for its implementation within six weeks, he added.
Under the new 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,” Jaitley said.
Budgetary support of Rs 27,413 crore for the Scheme has been approved from July 1, 2017 till March 31, 2027 for such industrial units located in these states which availed the benefit of Central Excise exemption prior to coming into force of GST regime, he said.
The Centre 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 industrialisation.
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 government has decided to pay a budgetary support equal to the central share of the cash component of Central GST and Integrated GST paid by the affected eligible industrial units.
First Published: Aug 16, 2017 20:06 IST