GST: No tax holidays for companies in Telangana
After July 1, any new industry or any project, tax exemption given by the state government has to pay from its own revenue.
Hyderabad: With the Goods and Services Tax (GST) coming into force from July 1, industries will not get any tax exemptions from the state government under its industrial policy.
GST bans tax exemptions to industries and other sectors. Under GST no exemptions are permitted by state governments to any sector.
In the industrial policy, Telangana government has extended incentives and exemptions, including VAT to major, medium enterprises including from 2014 to 2019.
The State government has announced reimbursement of 75% net VAT/ CST or state Goods and Service tax (SGST) for medium enterprises and 50% to large scale enterprises for a period of 7 years.
After July 1, any new industry or any project, tax exemption given by the state government has to pay from its own revenue.
Already existing enterprises which are enjoying tax exemption benefit have to pay GST from July 1, Later, the state government will reimburse from its own funds.
Principal Secretary of Revenue (Commercial Taxes and Excise) G. Somesh Kumar said under GST, state governments are not allowed any tax exemption for any project or industry.
He said if any exemption is given, the state government has to pay from its own revenue.
Meanwhile, the finance officials said state government is spending about Rs 400 crore to Rs 500 crore per year under various incentives such as subsidy to power, investment subsidy.
In this, the VAT portion is about Rs 100 crore to Rs 150 crore. After GST arrives, all industries and others which are enjoying tax benefits have to pay GST and later have to get reimbursement from the state government.