Citing Article 370, J&K rejects the current GST framework to preserve its financial autonomy and exclusive taxation powers.
The Goods and Services Tax (GST) legislation will not be enforced in its current form within Jammu and Kashmir, as stated by the region’s Finance Minister, Hasib Drabu. Jammu and Kashmir holds a unique position among Indian states, possessing special taxation powers, including the exclusive authority to impose taxes on services. As Union Finance Minister Arun Jaitley prepared for the final implementation of the GST Bill, Jammu and Kashmir still needed to ratify all four associated bills in its state assembly before the new tax framework could apply.
Drabu expressed concerns that the operationalization of GST and the subsequent establishment of the GST Council as the country’s de-facto tax authority might diminish the powers of state legislatures. Should GST be introduced in Kashmir, neither the state’s legislature nor its finance minister would retain the ability to unilaterally amend tax laws. This scenario directly conflicts with the financial autonomy that Jammu and Kashmir enjoys under Article 370 of the Constitution.
