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Govt extends tax break for industry in north eastern, hilly states till 2027

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Note4students

Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From UPSC perspective, the following things are important:

Prelims level: GST

Mains level:  Developmental supports to North-East areas


News

  1. The Cabinet Committee on Economic Affairs on Wednesday approved Rs 27,413 crore as Budgetary support for reimbursements for industrial units in northeastern and Himalayan states under Goods and Services Tax (GST) regime that used to earlier avail area-based central excise exemptions.
  2. Industries in the north eastern and Himalayan states of Jammu & Kashmir, Himachal Pradesh and Uttarakhand under the previous excise regime used to get 10-year exemption.
  3. There is a separate residuary period for every industry because of commencement of production and their consequent entitlement of a 10 year exemption.
  4. Under the new GST regime, there is no provision for exemption but there is one section under the Act which permits refunds.
  5. The sunset clause has been extended till 2027 and within the GST Act, each industry will be entitled to the refund mechanism during this particular period
  6. DIPP will notify the scheme, including detailed operational guidelines for implementation of the scheme within 6 weeks

Back2basics

Sunset clause

  • In public policy, a sunset provision or clause is a measure within a statute, regulation or other law that provides that the law shall cease to have effect after a specific date, unless further legislative action is taken to extend the law.

 

 

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