Eight years of GST in Jammu & Kashmir: Gains, gaps and the road ahead

Ziraat Times News Desk 

Srinagar — Eight years after Jammu and Kashmir joined the country’s Goods and Services Tax (GST) regime, the state’s tax landscape has undergone a structural transformation. While government officials have hailed the system as a “game changer,” a closer look reveals a more nuanced picture — marked by digital reforms, rising revenues, yet persistent questions on small businesses and compliance burdens.

GST, introduced nationwide on July 1, 2017, replaced a labyrinth of central and state levies with a unified tax system. However, due to J&K’s erstwhile special constitutional status, the state had to enact its own legislation—the J&K GST Act—on July 7, 2017. The law came into force a day later, officially aligning the state with the Centre’s GST framework.

A surge in registrations and revenues

Government data shows a steep rise in registered taxpayers—from just 72,000 in 2017–18 to over 2.2 lakh in 2025. In Jammu division alone, 8,276 new businesses registered under GST in the current financial year, reportedly driven by increased outreach efforts. Of these, over 80,000 businesses are considered active.

Revenue collections have also climbed steadily. Monthly GST collections have grown from around ₹200 crore in 2017–18 (annual: ₹2,402 crore) to ₹723 crore in 2024–25 (annual: ₹8,673 crore), according to the State Taxes Department. Officials credit this to improved digital systems, better enforcement, and increased awareness among traders and businesses.

The tech push and compliance culture

The State Taxes Department has expanded its digital infrastructure with GST Suvidha Kendras, online registration portals, and e-way bill systems. These initiatives, supported by the National Informatics Centre, are seen as key to reducing manual processes and corruption risks.

Commissioner State Taxes P.K. Bhat praised the department’s progress, highlighting the adoption of data analytics and enforcement measures to increase compliance. “We have made significant strides in improving efficiency,” he said, stressing the role of teamwork and technology.

However, some small traders continue to raise concerns. Several say that compliance requirements—from regular filings to understanding input tax credits—remain daunting for businesses without access to accounting expertise or digital tools. “The system helps large players, but many smaller shopkeepers still struggle with monthly return deadlines,” a Srinagar-based trader told Ziraat Times.

Economic analysts note that while GST has helped J&K plug revenue leakages and modernize its tax system, it has also made it more dependent on central policies and revenue-sharing formulas. “The GST Council’s decisions are binding, and J&K no longer has the legislative space it once did to tailor fiscal policy to local needs,” said a retired tax officer.

Looking ahead

Additional Commissioners Namrita Dogra (Jammu) and Parveez Ahmad Raina (Kashmir) have stressed the importance of maintaining transparency and improving scrutiny, including crackdowns on fraudulent ITC claims and fake registrations.

As GST enters its ninth year in J&K, experts stress the focus must now expand beyond numbers to include fairness, inclusivity and transparency. For a region still recovering from economic shocks, the tax system must work not only for the exchequer but for the everyday entrepreneur, trader and worker whose livelihood depends on it.