Widespread opposition to the application of GST in Kashmir

Srinagar: The proposed implementation of Goods and Services Tax (GST) in Jammu and Kashmir is snowballing into a major controversy. While separatists, mainstream politicians and business fraternity have threatened of dire consequences, the state government has decided to convene a special session of the Jammu and Kashmir State Assembly on GST. In the meantime Kashmir Traders and Manufacturers Federation (KTMF) have called for a day-long shutdown across the Valley on Saturday against the proposed implementation of GST. The GST is a value added tax (VAT) proposed to be a comprehensive indirect tax levy on manufacture, sale and consumption of goods as well as services at the national level. It will replace all indirect taxes levied on goods and services by the Indian Central and State governments. Such a tax can be applied to J&K only if the state assembly approves it.

“The new tax regime would erode state’s special powers and fiscal autonomy,” said Mohammad Yaseen Khan, president of KTMF, addressing media here on June 15, adding, “We don’t believe in ‘One India, One Tax’ and stand against it because Kashmir is a disputed territory.” Citing the state’s separate constitution and powers of the state Assembly, Khan said the traders’ community during their meetings with Chief Minister Mehbooba Mufti and Finance Minister Haseeb Drabu had asked for the state’s own GST.

A joint meeting of various trade bodies held under the banner of Kashmir Joint Business Forum (June 15) appealed to lawmakers of the state, cutting across party lines, to think independently and conscientiously and ensure that the state’s fiscal autonomy is preserved and not bartered away for petty financial gains or in trying to get some political mileage.

While Kashmir Chamber of Commerce & Industry in a statement here on June 14 said that the implementation of GST will deprive the state of its financial autonomy, Federation of Chambers of Industries Kashmir (FCIK), June 15, said that the extension of such laws to the state amounts to direct infringement with the special status of the state guaranteed and vowed to be maintained under Article 370 of the Constitution of India.

Separatists, while opposing the implementation of GST in the state, described it as a plan to cripple the trade and economy of the state. The joint separatist leadership including Hurriyat (G) chairman Syed Ali Geelani, Hurriyat (M) chairman Mirwaiz Umar Farooq and JKLF chairman Mohammad Yasin Malik, in a joint statement here June 14, said that they had “deep concern over the proposed implementation of the new tax regime. It is a well thought-out plan to cripple our trade and economy.”

The opposition National Conference here on June 15warned the state government against any “misadventure” on GST implementation in the state, saying that the party would fight it tooth and nail. Addressing a meeting of the party’s provincial committee, the party’s provincial president Nasir Aslam Wani said that the government’s state of confusion on GST is a “deliberate ploy to distort the reality and implement the regime in a covert, clandestine manner.” The senior party leader Mohammad Akbar Lone, addressing the meeting, alleged that the coalition partners have made up their mind to dilute the state’s fiscal autonomy to please the powers in New Delhi. Another party leader, Sakina Ittoo, reiterated that the party was united in its resolve to uphold the state’s autonomy and special status and would go to any extent to protect the rights of the people.

Minister of Finance Haseeb Drabu, June 15, said that a “false bogey” of dilution of the state’s fiscal autonomy has been raised by “vested interests to distort the genuine debate” over bringing the state under the new tax regime.“Far from eroding the special constitutional position, we are seeking to empower the state’s Legislative Assembly. If our government has any malafide intent, why would we bring it to the Assembly for a debate,” said the minister. He added, never before in the history of Jammu and Kashmir has the extension of a Constitutional Amendment of the Constitution of India toJammu and Kashmir been taken to the State Assembly for deliberations.“Around 46 amendments have been extended through presidential order to J&K which have gradually eroded the state’s special constitutional position. While it is true that the J&K Constitution gives us comprehensive legislative powers, the core of our special position is the powers of the Legislative Assembly. It is this institution of legislature that we are seeking to re-empower as it has been diluted over a period of time. Instead of resorting to rhetoric, the opposition should come forward with a constructive roadmap on how they would like to go about implementing the new tax regime while safeguarding the state’s fiscal autonomy.”

The Deputy Chief Minister Nirmal Singh said here on June 16 that the GST regime would be implemented in the state keeping in view the state’s special status and financial autonomy. He asked Hurriyat leaders not to politicize the issue. Talking to reporters on the sidelines of a function in Bandipora in north Kashmir, Singh said, “By implementing it, Jammu and Kashmir, which is a consumer state, will get the benefit of about Rs 1000 to 12000 crore rupees annually.” The Deputy Chief Minister added that to safeguard the special status of the state, they have proposed to constitute a committee for wider consultations on GST where each stakeholder including the traders’ associations would be taken on board. “The special Assembly session has been called to weed out differences and for the larger interest as well as to address the concerns of everyone.”

The Chief Minister in a meeting here with business leaders on GST (June 11) had assured them that the new tax regime won’t infringe upon the fiscal autonomy enjoyed by the state.

Meanwhile, the state government hosted a two-day GST Council meeting headed by Union Finance Minister Arun Jaitley here on May 18-19. Expressing its serious concerns over the GST council meet, Kashmir Economic Alliance (KEA), said in a statement here on May 17 that holding such meetings was awell-hatched plan of Government of India to implement the tax regime in the state and an attempt to erode financial autonomy of the state. The Alliance further emphasized that people and business community would fight tooth and nail to oppose the implementation of GST in the state.

We hope you liked this report/article. The Milli Gazette is a free and independent readers-supported media organisation. To support it, please contribute generously. Click here or email us at

blog comments powered by Disqus