Haryana CM Launches One Time Settlement Scheme for Pre-GST Tax Liabilities

In response to long-standing requests from the state's trader and business community, Haryana Chief Minister Manohar Lal Khattar introduced the One Time Settlement-2023 (OTS) Scheme on Sunday, December 31st, 2023. This scheme aims to resolve pre-Goods and Services Tax (GST) tax liabilities and will be operational from January 1st, 2024, to March 30th, 2024.

Representative image

OTS Scheme Details

Under the OTS-2023 scheme, businesses have the opportunity to settle their pre-GST tax liabilities. The scheme categorizes taxes into four groups and offers exemptions from interest and penalties for cases related to seven tax acts that were in effect before the implementation of GST.

Additionally, Chief Minister Khattar announced the establishment of a GST Training Institute in collaboration with HIPA, Gurugram. The institute aims to provide training and education on GST-related matters.

Tax Categories and Payment Options

The OTS scheme categorizes the tax amount into four categories:

• Undisputed Fee Category: For cases without dispute, taxpayers will pay 100% of the amount without any penalties or interest.
• Disputed Taxes Below Rs 50 Lakh: Taxpayers will pay 30% of the outstanding amount.
• Disputed Taxes Above Rs 50 Lakh: Taxpayers will pay 50% of the outstanding amount.
• Undisputed Taxes Assessed by the Department: Taxpayers will pay 40% if the amount is below Rs 50 lakh and 60% if it's above Rs 50 lakh. This category also offers relief from penalties and interest.

The OTS scheme also provides flexible installment options for taxpayers. For outstanding amounts below Rs 10 lakh, the entire sum must be paid in one lump sum before March 30th. For amounts between Rs 10 lakh and Rs 25 lakh, the payment can be made in two installments of 52% each. If the outstanding amount exceeds Rs 25 lakh, it can be spread across three installments: 40% in the first 90 days, 30% in the next 90 days, and 30% in the final 90 days.

Addressing Outstanding Tax Issues

The OTS Scheme aims to address outstanding tax issues from the Excise and Taxation Department until June 30th, 2017. It specifically resolves concerns related to seven VAT-related acts, including the Haryana Value Added Tax Act, 2003, the Central Sales Tax Act, 1956, the Haryana Local Area Development Tax Act, 2000, the Haryana Tax on Entry of Goods in Local Area Act, 2008, the Haryana Luxury Tax Act, 2007, the Punjab Entertainment Fee Act, and the Haryana General Sales Tax Act, 1973.

Benefits and Expectations

Deputy Chief Minister Dushyant Chautala, who oversees the Excise and Taxation Department, highlighted that the Haryana Government introduced this scheme for the welfare of traders and industrialists. A new bill was passed in the last assembly session to enable traders to receive exemptions in outstanding tax cases for the period till June 30th, 2017.

With the implementation of the OTS scheme, the state government expects to collect additional taxes and surpass the Chief Minister's target of Rs 58,000 crore for the department. Chautala expressed confidence that with the cooperation of businessmen, chartered accountants, and tax lawyers, tax collection in the state could reach Rs 66,000 crores by March 31st.