J&K GST Linked Incentive (GSTLI)

The GST Linked Incentive (GSTLI), offered under the New Central Sector Scheme 2021, refunds the GST that a Jammu & Kashmir unit pays on its output.

The incentive covers 100% of gross GST payment — meaning GST discharged through cash as well as through input tax credit — for up to 10 years, counted from the date commercial production or operation begins, or until the scheme lapses, whichever is earlier.

Two limits determine the actual benefit: the ten-year period, and a total ceiling of 300% of the amount invested in plant and machinery. Both new units and existing units carrying out substantial expansion are eligible, which makes the incentive a long-term offset against operating costs for units that have already sunk capital in the UT.

1. Enrol the unit on the J&K Single Window portal under the New Central Sector Scheme 2021. 2. Begin commercial production or operation, and note the date on which it commenced. 3. Lodge GSTLI claims at regular intervals alongside GST returns, disclosing the gross GST discharged in cash and via input tax credit. 4. Furnish certification of plant and machinery investment, which is required to work out the 300% ceiling. 5. The department carries out verification and releases reimbursement of the eligible GST amount.

There is no competitive selection involved. Verification of each claim is carried out by cross-checking GST returns, the certified investment in plant and machinery, and the remaining headroom available under the 300% ceiling.