States Will Get Rs 20 Thousand Crore – Announces Finance Minister After GST Meeting
New Delhi : Many important decisions have been taken in the meeting of the Goods and Services Tax (GST) Council. After the meeting, Finance Minister Nirmala Sitharaman told in a press conference that the GST of Rs 20 thousand crore will be paid to the states late on Monday night. 20,000 crore rupees received from compensation cess to the center will be distributed among the states.
She said that 20 states had agreed to the proposal of the Center in the meeting. But some states turned down the proposal. In a way, the issue of GST compensation has not been resolved in the meeting. The Finance Minister said that further issues will be discussed again in the meeting.
Finance Minister Nirmala Sitharaman said that we are not denying the compensation amount to the states. She said that such situation has arisen due to Corona crisis. No one had imagined before that such a situation would come. The current situation is not such that the central government is hiding the fund, and is refusing to give. Funds will have to be borrowed.
She said that Bihar Finance Minister Sushil Kumar Modi has suggested that everyone should talk together again on the option of borrowing. So we will meet again on October 12 and this problem will be discussed.
At the same time, it has been decided in the meeting that the compensation cess on luxury and many other items will be extended even beyond 2022. That is, on products like cars, cigarettes, the compensation cess will continue, it has been decided to save the states from harm. According to the rule, this was applicable only five years after the GST came into force.
Significantly, the states are demanding from the Central Government to pay the outstanding compensation of about 2.35 lakh crore GST. In return, the Center has given them two options to borrow. But the states are divided about this offer of the Center.
What is the mathematics of compensation
States owe GST compensation of about Rs 2.35 lakh crore, but the math of the central government is that out of this, the loss of about Rs 97,000 crore is due to the implementation of GST, the remaining revenue loss of about 1.38 lakh crores is due to corona epidemic and lockdown.
