Why This State is in Discussion After the Ban of Rs 2,000 Note?
The recent ban of the Rs 2,000 note has caused a stir in India, with people scrambling to exchange their old notes for new ones. However, there is one state that seems to be in the spotlight more than others – the state of Jammu and Kashmir. This is because many people in this state do not pay taxes and have been exempted from doing so by the Indian Constitution.
Exemption from Taxation in Jammu and Kashmir
The Constitution of India has a provision that exempts the state of Jammu and Kashmir from the Indian Income Tax Act. This means that people who reside in the state do not have to pay any income tax to the Indian government. This exemption was granted to Jammu and Kashmir when it became a part of India in 1947.
The reason behind this exemption is that the state has its own tax laws and regulations, which are different from those of the rest of India. This system of taxation is known as the Jammu and Kashmir Goods and Services Tax (J&K GST). The state government collects taxes from its citizens, which are then used to fund various development projects and initiatives.
Impact of the Ban on Rs 2,000 Note in Jammu and Kashmir
The ban on the Rs 2,000 note has had a significant impact on the state of Jammu and Kashmir. This is because the state is largely a cash-based economy, with many people not having bank accounts or access to digital payment systems. The ban on the Rs 2,000 note has made it difficult for people to conduct their daily transactions, as they are unable to withdraw money from ATMs or exchange their old notes for new ones.
The state government has taken several measures to address this issue, including setting up special counters for the exchange of old notes and increasing the withdrawal limits for cash from ATMs. However, these measures have not been enough to alleviate the difficulties faced by the people of Jammu and Kashmir.
The exemption from the Indian Income Tax Act has made Jammu and Kashmir a unique state in India. However, the ban on the Rs 2,000 note has highlighted the challenges faced by the state in terms of its cash-based economy. The state government will need to take further steps to address these challenges and ensure that the people of Jammu and Kashmir are not adversely affected by the ban on the Rs 2,000 note.
- Tax evasion
- Constitutional exemptions
- Black money
- State politics