Uncertainty in Srinagar over surrendering autonomy over GST

Jammu & Kashmir faces a constitutional crisis and a financial emergency following the stalemate over the Goods & Services Tax (GST). The state assembly has not been able to deliberate and the pass the legislation. The state government has failed to build a consensus. There is also widespread suspicion that New Delhi has a political agenda in diluting Article 370 further.

The state assembly convened for the purpose on June 17 failed to transact any business after the opposition objected to the GST on the ground that it takes away the state’s power to collect taxes. Any surrender of this power to the national GST Council, they declared, was not acceptable as it diluted the special position of J & K under the Indian Constitution.

Pointing out that J & K has its own Constitution and the state draws its authority to levy taxes from section five, the opposition demanded that the state should have its ‘own GST’. There is not much clarity though about how the deadlock can be broken. No PDP minister was willing to speak on this issue on Sunday, a day after the GST was rolled out in the rest of the country. Telephone of finance minister Haseeb Drabu was switched off.

A piquant situation has arisen because while traders in Jammu are clamouring for GST to be implemented immediately, traders in the Valley observed a complete shutdown on Saturday in protest.

“We are not against any tax regime but GST in the present form erodes the special status of Jammu and Kashmir that the Indian Constitution guaranteed under Article 370. The Government must address our concerns before it is passed in the state assembly,” said Mushaq Ahmad Wani, president Kashmir Chamber of Commerce & Industries to NH.

Hakeem Mohammad Yasin, Chairman People’s Democratic Front and MLA said that his party opposed the GST as it compromised the special position that state enjoys under the Article 370. “We demand a separate GST under Article 370” he added.

Many opposition leaders maintain that GST is a good step but they are against the extension of 101 Amendement Act of the Indian constitution to the state. Under this amendment Act, Article 246 A will empower the Centre to make laws with respect to goods and services that will be binding on the states.

“The 101 amendment in the present form is not palatable to us . It compromises on the state’s fiscal autonomy of state. GST is a smoke screen,”said a National Conference leader.

The state cabinet had approved the GST Bill on June 7. And finance minister Drabu said on Saturday that he was confident that the state assembly would clear the legislation in its sitting on Thursday, July 6.

Under the Constitution, the state government is to write to the President of India requesting for a particular legislation to be extended to J & K. But the state government, it is learnt, is yet to write to the President, in the absence of a specific endorsement by the state legislature.

“Things could move swiftly downhill if the Government introduces GST in its present form as it will be seen as another attempt by the central government to dilute the state’s special status’’ said Shahnawaz Ahmad Mantoo, a political analyst in Srinagar.