Chandigarh, September 4

To enhance tax compliance and further streamline the State Goods and Services Tax (SGST) regime, the Punjab Vidhan Sabha, led by Chief Minister Bhagwant Singh Mann, unanimously passed the Punjab Goods and Services Tax Amendment Bill, 2024, on Wednesday. The bill was introduced by Finance, Planning, Excise, and Taxation Minister Advocate Harpal Singh Cheema.

While introducing the bill, Finance Minister Harpal Singh Cheema highlighted the key amendments, including the exclusion of Extra Neutral Alcohol (ENA) used for manufacturing liquor for human consumption from the GST purview. He said that now Value Added Tax (VAT) will be charged on ENA being used for manufacturing liquor.

Announcing big relief to taxpayers, the Finance Minister said that the Taxpayers will allowed to avail the input tax credit (ITC) claimed through returns filed up to November 30, 2021, for the financial years 2017-18 to 2020-21. “Additionally, an authorized representative can now appear on behalf of the summoned person instead of personal appearance of the owner/ dealer himself as was the case previously. Further, the notice period for taxpayers has been extended from 30 days to 60 days for future adjudication, simplifying the procedures and enhancing tax compliance”, said Cheema.

Finance Minister further also announced amnesty for taxpayers for the financial years 2017-18 to 2019-20. He said that if a taxpayer pays the full amount of tax demand pertaining to years 2017-18 to 2019-20 by March 31, 2025, he will be granted a complete waiver of interest and penalty.

During the discussion on the bill, Finance Minister Harpal Singh Cheema expressed gratitude to Principal Budh Ram for highlighting the issue of GST compensation. He said that when the GST system was introduced in 2017, a 14% year on year growth-based compensation for States was agreed upon until July, 2022. However, he lamented that the previous governments made no efforts to revive the State's economy over the next five years, relying solely on compensation. “In contrast, the current government, under Chief Minister Bhagwant Singh Mann's leadership, has initiated various measures, including establishing a tax intelligence unit, emplying intelligent module developed by IIT Hyderabad and launching schemes like 'Bill Layo Inam Pao', to enhance tax compliance. As a result, the State has seen a significant increase in GST collections”, he added.

Minister Cheema pointed out that the GST system's implementation led to the subsuming of all kinds of taxes levied by the State. Previously, the state received approximately Rs. 7,000 crores from the Central Givernment on food grains which would have increased to around Rs 10,000 crores by now. It now stands subsumed in GST. Unfortunately, the previous state government failed to secure compensation for this significant loss”, said Cheema.

Minister Cheema also criticized the previous government, led by Chief Minister Charanjit Singh Channi, for falsely claiming to have waived taxes for 40,000 traders in OTS. In reality, not a single trader benefited. He highlighted that, for the first time, under Chief Minister Bhagwant Singh Mann's leadership, over 70,000 Punjab traders have benefited from the OTS scheme, and the state treasury has earned Rs 164.35 Cr.