Both the Houses of the Jammu and Kashmir legislature on Wednesday passed a resolution adopting the Goods and Services Tax (GST) through a presidential order.
Finance Minister Haseeb Drabu said GST would be implemented “under the ambit of Article 370, ensuring adequate safeguards for special status.”
He said the State would bring the GST Council under Article 370 to protect the State’s fiscal autonomy.
“We are proposing that Article 370 shall not be compromised in any way through the presidential order. The GST Council should not be a way to subvert the process and enough safeguards are built to empower the constituents of J&K in the Council. Besides, the exclusive powers of the State to tax and the consolidated fund of J&K shall not be impaired,” said Mr. Drabu.
He said Article 370, which gives special status to the State, should be “used for development and empowerment.” “Instead, the issue is being used as a tool to whip up passions and draw political mileage. It is being used for creating fake controversies,” he said.
Addressing fears raised by the business community here, he said, “Industry exemptions and tax remissions will continue both from the Centre and the State Government under the new tax regime.”
Rejecting the opposition Congress and National Conference’s (NC) demand “to pass [J&K’s] own GST Bill” and “seek changes to the 101st amendment of the Constitution of India” to safeguard J&K’s fiscal autonomy, Mr. Drabu said: “Section 5 of the Constitution of J&K, which gives it special taxation powers, will not be amended under any circumstances. It will open a Pandora’s Box that will have implications on J&K’s special constitutional position.”
Describing the GST Council as a “truly federal institution”, Mr. Drabu said, “India is moving from coercive to cooperative federalism.”
Both the houses passed the GST resolution with a voice vote. It was followed by the procedural meeting of the State Cabinet in Srinagar.
The NC and Congress were seen raising slogans in protest against the passage of the GST resolution.
Curbs in Srinagar
Restrictions were imposed in parts of Srinagar as several anti-GST trade bodies’ leaders remained under lock-up since Tuesday.
Concertina wires were placed on all routes in areas connecting seven politicians in the city. Security forces disallowed movement of people or vehicles.
A shutdown call, issued by traders against the government clampdown on business leaders, saw many major markets closed in Kashmir.
Meanwhile, separatist leaders, including Syed Ali Geelani, Mirwaiz Umar Farooq and Yasin Malik described the GST as the “latest assault on J&K.”
The separatist leaders have asked the J&K Coordination Committee, a body of traders, “to look into the issue and safeguard any further dilution of the special status, which in turn affects the disputed nature of the Kashmir issue.”
