Lucknow, Nov. 22 -- Uttar Pradesh is set to bring a merger-demerger policy by amending the Stamp Act to tax corporate restructuring transactions and the proposal is expected to be placed before the state cabinet shortly, officials in the know of things said. This long-pending reform could not be implemented so far despite attempts since 2016, the officials added. The policy could generate an additional Rs 2,000 crore annually, significantly contributing to the state's total annual revenue, the officials further said. The Yogi Adityanath government, according to these officials, has now decided to move ahead decisively. Once cleared, a Bill to amend the Stamp Act will be introduced in the winter session of the assembly. "A Cabinet note seeking to bring corporate restructuring into the stamp tax net has been prepared and will be sent to the government within a week," a senior stamp and registration department official revealed. Uttar Pradesh currently levies no stamp duty at all on corporate mergers or demergers involving transfer of property, shares, cash or other assets, even though such transactions generate significant tax revenue in several other states. "This gap has led to a clear and continuous revenue loss for Uttar Pradesh," the official said, explaining that the state's stamp law had no defined provisions for taxing restructuring transactions. Officials said the state had attempted several times since 2016 to bring companies under the stamp duty net, but the proposal never reached the Cabinet. "As a result, Uttar Pradesh continued losing revenue while states like Karnataka, Madhya Pradesh, Rajasthan, Tamil Nadu and Haryana tightened their stamp frameworks," according to another official involved with the earlier attempts. This time, officials say, the government is determined. The policy proposes levying 2% to 5% stamp duty depending on the nature and valuation of the merger or demerger, transfer of assets etc. The stamp tax liability is proposed to come into force with retrospective effect with past mergers and demergers of companies also to attract the stamp duty. The move comes as Uttar Pradesh undergoes rapid industrialisation and corporatisation, drawing more companies into manufacturing, logistics, fintech, data centres and allied sectors. "With so many companies coming to UP, the absence of a merger-demerger duty structure is no longer sustainable," officials said. The amendment is also linked to the state's $1 trillion economy goal. Deloitte, the consultant appointed to help achieve this target, is understood to have advised the state to bring corporate restructuring within the stamp duty net to boost internal revenue mobilisation and reduce ambiguity for investors. This time around, it is claimed that many industry bodies themselves have been seeking clarity on stamp obligations in UP. "Companies want certainty. They prefer a clear, codified policy rather than arbitrary assessments or disputes," another official said, adding that a transparent framework would improve ease of doing business. With the Cabinet set to take up the proposal soon, the long-pending reform blocked for nearly a decade appears finally ready to move. Once approved, the government will bring the amendment Bill in the winter session, paving the way for Uttar Pradesh to formally tax corporate mergers and demergers for the first time....