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GST collection, devolution success stories of NE: Sitharaman

BNE News Desk , July 22, 2023
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Guwahati: The northeastern states are success stories of GST collection and devolution, Union Finance Minister Nirmala Sitharaman said in Guwahati on July 21.

Sitharaman during the Investiture Ceremony here highlighted the success stories of GST collection and devolution in the northeastern states. According to the 2023 RBI report on state finances, the eight NE states have seen a compounded annual GST hike of 27.5%, indicating significant growth in GST revenue.

The finance minister emphasised that the GST’s principal focus is on taxing consumption rather than taxing based on the place of production. This makes GST a destination-based tax, unlike the earlier central sales tax, which was origin-based. As a result of this shift, the northeastern states, being consuming states, have benefited from the GST system.

Assam, which was the first state to ratify the GST Act just four days after it was passed, has experienced a substantial increase in tax collection. Before the implementation of GST, Assam’s sales tax collection was Rs 558.26 crore, but it has now increased manifold to Rs 7,097 crore.

Similarly, Sikkim and Meghalaya have also achieved significant progress in GST collection. Sikkim’s collection increased from Rs 263.5 crore to Rs. 3,036 crore, and Meghalaya’s collection increased from Rs 587.21 crore to Rs 2,078 crore.

The finance minister expressed that GST has brought about a significant improvement in the tax system, benefiting not only the states but also the people at large.

Additionally, considering the region’s borders with four countries and the presence of 25 functional Land Customs Stations (LCS), the finance minister urged officials to equip the remaining 10 LCSes with electronic facilities by December. The electronic facilities would aid in detecting and preventing smuggling activities.

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