In a move that will surely address the growing concerns among states, the centre released Rs 19,950 crore as GST compensation to states and Union Territories ahead of the GST council meet, thereby taking the total amount released to them to over Rs 1.2 lakh crore. In a statement, the finance ministry said Rs 19,950 crore was released to states and union territories on last Monday. Finance Ministry officials said total GST compensation cess of Rs 62,611 crore was collected in the FY 2017-18, out of which Rs 41,146 crore was released to the states/UTs that fiscal as GST compensation.
In FY 2018-19, Rs 95,081 crore was collected as GST compensation cess of which Rs 69,275 crore was released to the states/UTs as GST compensation. Finance Minister Nirmala Sitharaman, on February 17, said that the compensation cess collection saw a dip in December, which led to the delay in handing out GST compensation to the states. Sitharaman in her Budget 2020 speech said the government has decided to transfer to the GST Compensation Fund balances in two installments.
In December 2019, the Centre had released Rs 35,298 crore to states to compensate for the revenue loss on account of GST rollout. During the Budget session, Union minister Anurag Thakur said that the GST Compensation had been released till September, 2019 and the next bi-monthly GST Compensation was due for October-November, 2019.
A total of Rs 2,10,969.49 crore has been released as GST compensation to states so far including UTs of Delhi and Puducherry after implementation of GST, the minister said. Under GST law, states were guaranteed to be paid for any loss of revenue in the first five years of GST implementation, which came into force from July 1, 2017. It was agreed that the Centre would compensate states for shortfall in GST collections as per a defined formula.
Your email address will not be published. Required fields are marked *