Following a big meet ahead central government released Rs.35,000 crore to the states in order to compensate for revenue loses for Goods and Service Tax requesting. Requesting anonymity two government officials said.
A Compensation for the month of August and September 2019has been released whereas compensation for another two months October - September 19 is yet to be paid said an official from finance ministry who does not wish to be named.
A State finance minister of the opposition party said, The compensation received isnt good enough. We want the compensation to be paid for the four months August to September and October - November as states are already facing acute fund crunch, which is also because of the economic slowdown. It is not an act of charity by the center, states have to be compensated as per the law and the center must honor its commitment in letter & spirit, said the finance minister of the state.
The inordinate delay in paying compensation should be raised in the GST council meeting on Wednesday. said another finance minister of opposition ruled state.
The Goods and Service Tax (Compensates to States) Act, 2017 makes a provision to levy compensation on certain goods and luxury items towards states and union territory for revenue loss occurred due to shifting from Indirect taxes to GST dating |July 2017 until 5 years. This period can be further increased by the GST council.
According to the GST Act state revenue loss shall be calculated & compensated at the end of every two months and he totals compensation shall be finally calculated based on Audit by the Comptroller and Auditor General of India final revenue figures.
The center has delayed in paying these figures due to inadequate revenue collections.
"We will honor compact, there is no question about it." said finance minister Nirmala Sitharaman.
Just to give a picture, in 2017-18, Sir, the total cess collected was Rs.62,596 crore; cess released to the States that year was Rs.41,146 crores; cess accumulated in the Fund because what was collected and what is given has a difference, Rs 15,000 crore. So, Rs.15,000 crore got accumulated in the Fund.
Now, go over to the next year,2018-19. Cess collected was Rs 95,082 crore; cess released to the States was Rs.69,275 crore; cess accumulated in the Fund was Zero.
Cess collected till 31st October 2019, Rs.55,467 crore; cess released to the States this year, Rs.65,250 crore. The cess released to the States in excess of collection, therefore, is Rs.9,783 crore. Till 31 October 2019, Sir, the Government of India has released Rs.9,783 crore, that amount which I just read. Till 31 October 2019, the Government of India has released Rs.9,783 crore more than the amount raised through cess collections, said the Finance Minister Sitharaman.Also, Read More News.