Reimbursement of full Central GST and 50 per cent of net Integrated GST paid – Industry claims

The GST Council is likely to discuss a demand of industrial units located in 11 Himalayan and North Eastern states for reimbursement of full Central GST and 50 per cent of net Integrated GST paid, sources said. Currently, Centre reimburses 58 per cent of net CGST and 29 per cent net IGST under the a central Government scheme — ‘Scheme of budgetary support’ notified in October 2017.

However, industrial units located in the Himalayan and North Eastern States have been seeking implementation of a mechanism for reimbursement of balance 42 per cent of the CGST and 21 per cent of the IGST paid by them in cash along with appropriate interest. States are, however, reluctant to reimburse their share of CGST and IGST collection they receive on account of tax devolution citing unsatisfactory revenue growth and implementation of similar schemes by the state to incentive industries.

In the pre-GST era of excise duty, industrial units Jammu & Kashmir, Himachal Pradesh, Uttarakhand, Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura enjoyed a tax holiday. Sources said in view of the Supreme Court judgement in October, 2022, and further directions by the High Courts of Delhi, Meghalaya and Guwahati, the issue would have to be discussed by the GST Council in its 50th meeting on July 11.

Read more at: FINANCIAL EXPRESS