New Delhi, July 17: Cautioning against any hasty decision on the imposition of General Sales Tax (GST) regime, senior PDP leader and Member Parliament Tariq Hameed Karra today said the Government of India must ensure that the special taxation powers of the states like Jammu and Kashmir should not get compromised under the new taxation framework.
“J&K is bound to lose most heavily both financially and politically from the imposition of GST regime,” Karra told the Lok Sabha while participating in the discussion on Budget 2014-15.
He said if GST regime is implemented in JK in its present form and shape neither the state legislature nor the state cabinet will have an unfettered say on taxation.
“To add insult to injury, in the proposed framework the union finance minister can shoot down any proposal coming from the state on tax rates, goods to be left out of GST. It would be an irreparable loss for JK which is the only state in the country that has the power to tax services,” he said and added that by virtue of its Sales Tax Act, J&K has the power to tax both goods and services and any move to surrender it under GST regime would tantamount to compromising the State’s fiscal autonomy.
He under GST regime the State government can’t even offer tax rebates to industry and other enterprises on its own which would set a blow to the budding industry in J&K.
Reiterating the party’s demand for setting up an IIM and AIIMS in Srinagar, Mr Karra said J&K should be included in various flagship initiatives announced by the Governmnet of India in the Budget 2014-15.
“To cope up with the burgeoning unemployment problem in the State, Rs 1000 crore should be provided to JK out of the Rs 10,000 crore corpus of venture capital fund,” he said this money would be used for providing equity through venture capital funds, quasi equity, soft loans and other risk capital to encourage new startups by youth.
Mr Karra said Srinagar should be included in the list of 100 smart cities to be developed with a corpus funding of Rs 7,060 crore earmarked in the budget. “This will not only promote tourism in Kashmir but also give a fillip to the infrastructure which is otherwise crumbling because of lack of proper planning and population gowth,” he said and added that Srinagar should be also included in the list of cities for Metro projects as traffic congestion and road rage has become a major life threat in the City.
Similarly, he said from the Warehouse Infrastructure Fund which will get Rs 5,000 crore this year, Rs 500 crore should be earmarked for J&K to facilitate horticulture funding in the State.