1. Home >
  2. Export Import News >
  3. GST News >
  4. Five state finance ministers lash out at Centre over delay in GST compensation >
  5. Five state finance ministers lash out at Centre over delay in GST compensation

Online Export Import Data Search

Recent Searches: No Recent Searches
Complete Training Video : Click Here

Five state finance ministers lash out at Centre over delay in GST compensation.

Date: 21-11-2019
Subject: Five state finance ministers lash out at Centre over delay in GST compensation
Five opposition-ruled states on November hit out at the Centre over delays in releasing GST compensation saying their finances are in dire strait due to delays. AAP-ruled Delhi, TMC-run West Bengal, Congress-ruled Punjab and Rajasthan and Left-run Kerala in a joint statement said compensation since August is pending, making running administration difficult in the states.

When the Goods and Service Tax (GST) subsumed 17 different central and state levies from July 1, 2017, states were promised that they will be compensated for any loss of tax revenues for five years due to the introduction of the new levy. The compensation was to be paid on a monthly basis but the same has not bee released so far for the months of August and September and that of October would be due soon.

In all, some Rs 10,000 crore is due to the five states, the finance ministers of the opposition ruled states said.

BJP-ruled states too would not have got compensation but they haven't yet spoken about it.

The central government has so far commented on the issue nor has it given out reason for the delay.

Speaking to reporters, West Bengal Finance Minister Amit Mitra said, "We thought we will make an appeal to Union Finance Minister (Nirmala Sitharaman) saying that she must personally look into this and not violate the constitutional provisions as passed by Parliament of India."

All the states are in distress if this compensation which is due to them is not given, he said.

"It is a dangerous situation, there is no precedence before," he said, adding this is the first time in history that there has been a delay.

"States have not received GST compensation for August and September which is against constitutional amendment where it was stated clearly that states when they fall below 14 per cent rate of growth of their GST (revenue), they will get compensation by the Centre. So far we have been receiving compensation," he said.

As far as West Bengal is concerned, the pending amount stands at Rs 1,500 crore, he said.

Kerala Finance Minister Thomas Isaac said the state was supposed to get Rs 1,600 crore.

"Kerala (is) under overdraft for almost one week now. This is Centre-engineered crisis in the state finance. It has never happened in the history of India. Something drastic has to be done," Issac said.

Punjab is also under threat of overdraft if the dues are not released immediately, state Finance Minister Manpreet Singh Badal said.

Punjab is awaiting Rs 2,100 crore as compensation while arrears stand at Rs 2,000 crore, Badal said.

Echoing similar concerns, Delhi Deputy Chief Minister Manish Sisodia said due to delay in payment, finances of states are under pressure. The GST compensation due to Delhi is Rs 2,355 crore.

In their joint statement, the ministers said no explanation whatsoever has been furnished for this delay and as a result, states are facing acute pressure on fiscal health and some are already resorting to overdrafts.

"GST comprises nearly 60 per cent of the tax revenues of states. Many states are already facing deficits up to 50 per cent of the total GST. Such huge deficits have the potential to disrupt the budget and planning processes in a host of areas literally bringing activities of the States to a grinding halt," it said.

It was recalled that the assurance of GST compensation was a necessary enabler in states agreeing to subsume their fiscal sovereignty into GST. This was preceded by long deliberations within the Empowered Committee where many states had apprehensions about being able to obtain uninterrupted compensation, it added.

"It was only after the required provisions for compensation were incorporated in the Constitution that States agreed to join the GST. The current delay has shaken the confidence of the States who have so far supported GST in a spirit of rare bonhomie. Despite many challenges from time-to-time States have extended their support to all major decisions of the GST Council," the statement said.

They also suggested that the matter should be placed on the agenda of the next meeting of the GST Council and a healthy mechanism be evolved to provide compensation in future with due urgency and judiciousness.

Source: moneycontrol.com

Get Sample Now

Which service(s) are you interested in?
 Export Data
 Import Data
 Exim Help

What is New?

Date: 25-08-2020

Date: 09-07-2020
Notification No. 18/2020-Customs (ADD)
Seeks to extend anti-dumping duty on import of Phenol originating in or exported from South Africa, imposed vide Notification No. 32/2015-Customs(ADD) dated 10.07.2015, up to and inclusive of 9th January, 2021.

Date: 08-07-2020
Notification No. 17/2020-Customs (ADD)
Seeks to levy definitive anti-dumping duty on imports of ' Steel and Fibre Glass Measuring tapes and their parts and components ',originating in, or exported from, People's Republic of China for a period of five years, in pursuance of final findings of sunset review investigations issued by DGTR

Date: 06-07-2020
Notification No. 29/2020-Customs
Seeks to further amend notification no. 152/2009 dated 31.12.2009, to increase the rate of duty of customs on imports of Phthalic Anhydride originating in Korea RP and imported under the India-Korea Comprehensive Economic Partnership Agreement, on recommendation of preliminary findings of Directorate General of Trade Remedies under India-Korea Comprehensive Economic Partnership Agreement (Bilateral Safeguard Measures) Rules, 2017.

Date: 02-07-2020
Notification No. 55/2020 - Customs (N.T.)
Exchange Rates Notification No.55/2020-Custom (NT) dated 02.07.2020.

Date: 01-07-2020
Notification No. 58/2020 – Central Tax
Seeks to make eighth amendment (2020) to CGST Rules

Date: 30-06-2020
Notification No. 54/2020-CUSTOMS (N.T.)
Tariff Notification in respect of Fixation of Tariff Value of Edible Oils, Brass Scrap, Poppy Seeds, Areca Nut, Gold and Silver- Reg.

Date: 30-06-2020
Circular No.31/2020-Customs
Extension of validity of AEO certification for ease of renewal process (Modification in Circular No. 27/2020 dated 02.06.2020) [Circular No. 31/2020 - Customs dated 30.06.2020].

Date: 30-06-2020
Notification No. 57/2020 – Central Tax
Seeks to amend notification no. 52/2020-Central Tax in order to provide conditional waiver of lat fees for the period from July, 2017 to July, 2020.

Date: 30-06-2020
PUBLIC NOTICE No. 11/2015-2020
Extension of validity of Recognition of Pre-shipment Inspection Agencies (PSIAs

Exim Guru Copyright © 1999-2020 Exim Guru. All Rights Reserved.
The information presented on the site is believed to be accurate. However, InfodriveIndia takes no legal responsibilities for the validity of the information.
Please read our Terms of Use and Privacy Policy before you use this Export Import Data Directory.


C/o InfodriveIndia Pvt Ltd
F-19, Pocket F, Okhla Phase-I
Okhla Industrial Area
New Delhi - 110020, India
Phone : 011 - 40703001