Gives go forward to amend (FRBM) act, 2003 to avail good thing about further central borrowing
CHANDIGARH: To promote post-Covid industrial revival and appeal to higher funding, the Punjab Cabinet led by Captain Amarinder Singh on Friday gave approval to amend the Industrial & Business Development Policy, 2017, for extension of GST formulation for availing incentives below the mentioned policy until October 17, 2022.
The transfer can also be prompted by suggestions/solutions from sure trade associations for extending the final date of claiming the GST incentive, given within the notification dated October 17, 2018, and make this final date as coterminous until the expiry of the Industrial Policy of the state.
The fiscal incentive below the current Policy was solely relevant for funding proposals acquired by March 31, 2020 on the Invest Punjab Business First Portal. With the Cabinet choice, the GST Formula notified vide notification no. 4888 dated October 17, 2018 shall be prolonged for availing incentive below Industrial & Business Development Policy, 2017 until October 17, 2022 (i.e. until the applicability of Industrial & Business Development Policy, 2017).
Notably, the Industrial and Business Development Policy-2017 was formulated and notified on October 17, 2017 to present the motivation of funding subsidy by the use of reimbursement of web SGST. This formulation for the calculation of the motivation was authorised by the Cabinet on October 17, 2018 and notified on the identical day. Thereafter, an modification was issued on March 7, 2019.
(FRBM) ACT 2003 TO BE AMENDED FOR ADDITIONAL BORROWING
To avail the good thing about further borrowing of two% of Gross State Domestic Product (GSDP) in 2020-21, the Cabinet additionally gave approval to amend Section 4, in Sub-Section (2), for Clause (a) of the Punjab Fiscal Responsibility and Budget Management (FRBM) Act, 2003.
Notably, the Government of India has allowed 2% of GSDP, of which 1% shall be unconditional and remaining 1% shall be conditional to particular reforms.
It could also be recalled that in view of the Covid pandemic, the Government of India had determined to present leisure in borrowing limits by growing a further borrowing restrict of upto 2% of GSDP for the yr 2020-21 topic to implementation of particular state degree reforms in addition to modification of state’s FRBM laws for the yr 2020-21 to this impact. Of this 2%, 0.5% was unconditional and the remaining 1.5% was conditional in respect of reforms viz; implementation of 1 nation one ration card system; ease of doing enterprise reforms; city native physique/utility reforms and energy sector reforms. The weight-age of every reform could be 0.25% of GSDP totalling to 1%. The remaining borrowing restrict of 0.50% was to be conditional to enterprise of not less than 3 out of the above named reforms.
To compensate the shortfall arising out of GST implementation, the GoI had provided two borrowing Option-I and II to the States, of which, the Punjab state had opted Option-I.
Option-I has given permission to the states to borrow the ultimate instalment of 0.5% (initially meant as a bonus for finishing not less than three of the 4 specified reforms) even with out assembly the pre-conditions. Thus, Punjab has been allowed 1% unconditional further borrowing restrict instead of 0.5% out of the two% further borrowing restrict allowed earlier. The remaining 1% further borrowing restrict shall be conditional to above talked about reforms. Therefore, the state is required to amend its Fiscal Responsibility and Budget Management Act, 2003.