Punjab Government Extends Tax Settlement Window as businesses seek crucial relief from Pre-GST Dues

Punjab Government Extends Tax Settlement Window as businesses seek crucial relief from Pre-GST Dues​

Deadline Extension for One-Time Tax Settlement Scheme​

The Punjab government has significantly extended the deadline for its one-time tax settlement (OTS) scheme, providing a final opportunity to taxpayers who have accumulated pending dues relating to the period before the implementation of GST. The scheme, which was previously set to close on July 31, has been granted an extension until September 30, offering substantial relief and resolving long-standing tax disputes.

Finance, Excise and Taxation Minister Harpal Singh Cheema announced the extension, stating that it is a direct response to strong demand from the business community. The measure aims to facilitate the amicable resolution of legacy tax matters for taxpayers operating under the pre-GST regime, which began before the nationwide GST implementation on July 1, 2017.

Financial Status and Taxpayer Confidence​

As of July 30, the government had received 9,782 applications under the OTS scheme, covering a cumulative tax demand amounting to Rs 437.51 crore. To date, taxpayers have deposited Rs 167.23 crore towards settling these liabilities.

The minister highlighted the considerable relief provided by the state. Through waivers of interest and penalties, the government has granted an abatement valued at Rs 534.54 crore to the eligible businesses. This initiative is seen as a demonstration of the government’s commitment to transparent and business-friendly policies designed to clear historical tax disputes.

Relief Structure for Outstanding Liabilities​

The extension grants all remaining 9,386 eligible taxpayers the opportunity to avail a 100 per cent waiver on interest and penalties, alongside slab-wise relief in principal tax amounts. Minister Cheema emphasized that while providing this relief, the government is pursuing a balanced approach by maintaining firm action against frequent defaulters.

The OTS scheme is being actively managed to support the Supreme Court's SAMADHAN initiative for settling complicated tax disputes. He confirmed that 12 major tax disputes have already been resolved under these efforts, with four more currently progressing towards amicable settlement.

Intensified Recovery Efforts Against Defaulters​

In a sharp counterpoint to the relaxation provided by the scheme, Minister Cheema stated that the Excise and Taxation Department has substantially intensified recovery proceedings against habitual defaulters of Value Added Tax (VAT). Coercive measures, including property attachment and auction, are now being aggressively pursued.

The enforcement action undertaken so far has successfully recovered more than Rs 12.39 crore. The department has scheduled 13 auction proceedings in August alone, aiming to recover around Rs 48.48 crore from outstanding dues.

The minister strongly urged all taxpayers to utilize the current opportunity provided by the OTS scheme to settle their liabilities before any of the planned auction dates. He warned that September 30 marks a strictly final opportunity; following this deadline, the government will escalate coercive recovery measures, including freezing bank accounts and property auctions under tax laws and the Punjab Land Revenue Act.