In a setback to those firms resting in the northeast, the government has cleared that there will be no tax exemptions for the hilly states and northeastern regions under GST. It was known that the GST council had earlier in 2016 decided that all those businesses which were getting tax exemptions will not be getting relaxation under GST. They will have to deposit all the taxes and will further get tax refunds accordingly.
Minister of State for Finance Shiv Pratap Shukla also stated that “It was also decided that the decision to continue with any incentive given to specific industries in existing industrial policies of states or through any schemes of the Central government shall be with the concerned state or Central government.”
While in case any state government wants to continue the exemptions then it solely depends on it and will be managed according to the reimbursement mechanism via a budget systematic route.
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While the central government had also announced that a scheme for the budgetary grant to the units eligible for exemptions and refunds benefits in the central excise structure is underway.
The government had previously done various announcement over the matter of northeast states and their tax exemptions. The tax exemptions will be in the form of the tax refund as in the first case the tax will have to be submitted to the department.
