In the Kerala Budget 2021, presented today, the State Government has extended the Amnesty Scheme to New Financial Year also.
A comprehensive amnesty scheme was implemented last year for VAT arrears. Total number of 32237 dealers have benefited under this scheme and Tax arrears of 3400 Crores will be settled. Pending VAT assessments are expected to be completed only by March this year.
The Finance Minister also said that the scheme will be applicable for tax arrears under KVAT, CST, Luxury Tax, arrears under Surcharge Act, and Kerala Agriculture Income Tax Act. If the arrears under this scheme are paid in a lump sum, a 40% reduction in tax will be allowed. For those who opt to pay in installments, the reduction will be 30%. Options shall be filed before 31st August 2021. All other conditions of the present amnesty scheme will continue.
The Bar Hotels which were closed as per the Government policy and obtained license subsequently could not file return for the relevant period due to software related issues. There were complaints against exorbitant demands created against the dealers on account of tax and penalty. Last year such dealers were provided with an option to pay tax based on compounding pattern. They were allowed complete reduction in penalty and 50% reduction in interest. Due to COVID related crisis the default in filing return continued in the year 2020-21 also. Hence the concessions granted in last year will be extended for the arrears up to 31st December 2020. The option shall be filed before 30th June 2021 and the arrears shall be paid before 31st July 2021.
In the 2019-20 budget certain concessions were granted in the criteria for fixing compounded tax of bar hotels who lost their license due to the Abkari policy of the Government for the year 2014-15. It will be clarified that this concession will be applicable to those who have lost their license in 2015-16 also.
He also added that the loss-making public-sector undertakings of the State Government who opt for the amnesty will be provided with a special loan scheme to clear the tax arrears. Detailed guidelines will be issued in this regard.
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