Centre releases Rs 19,950 crore as GST compensation to states, UTs
To address, the growing concerns among states, the Central Government has released Rs 19,950 crore as GST compensation to states.
To address, the growing concerns among states, the Central Government has released Rs 19,950 crore as GST compensation to states. The amount was released to states last Monday. With this release of GST compensation, the Central Government has released a total of over Rs 1.20 lakh crore towards GST compensation to the states during current fiscal.
In a statement, the finance ministry said Rs 19,950 crore was released to states and union territories on last Monday.
In the financial year 2018-19, an amount of over Rs 95 thousand crores was collected as GST compensation cess of which over Rs 69 thousand crores was released to the States and Union Territories as GST compensation. Likewise, GST compensation cess of Rs62,611 crore was collected in the FY 2017-18, out of which Rs 41,146 crore was released to the states and UTs as GST compensation.
Earlier this week on February 17, 2020, the Finance Minister Nirmala Sitharaman said that the compensation cess collection saw a dip in December, which led to the delay in handing out GST compensation to the states. FM Sitharaman in her Budget 2020 speech said the government has decided to transfer to the GST Compensation Fund balances in two instalments.
In December 2019, the Centre had released Rs 35,298 crore to states to compensate for the revenue loss on account of GST rollout.
Besides, Anurag Thakur, MoS, Finance, during the budget session said, the GST Compensation of till September 2019 has been released and the next bi-monthly GST Compensation was due for October and November 2019. He added 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.
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 a shortfall in GST collections as per a defined formula.