‘Centre betraying States by not paying GST compensation’

Manish Sisodia  

Deputy Chief Minister Manish Sisodia on Thursday said that the Central government’s alleged refusal to pay GST compensation to States was the “biggest betrayal” in the history of federalism in India.

Shortfall in collection

Commenting on the alleged refusal to pay GST compensation by the Centre, he said, “In the last four months, we have collected ₹7,000 crore lesser tax. If we look at the entire year, we will have a shortfall of ₹21,000 crore. The Central government should take a loan on our behalf as we also need to pay salaries to our doctors, teachers, engineers, DTC, and other employees.”

The Minister said when GST was rolled out, States were promised that they would be given compensation for the next five years with 14% growth. But now, the Central government has refused to pay. It said that as per the law, due to the ongoing situation created by the pandemic, the Central government is not liable to pay anything.

“Today, many States, including the BJP-led States is demanding compensation from the Centre. Many States quoted the minutes of the meetings of the GST Council, where it was clearly stated that the Central government takes full responsibility if revenue of any State decreases and will compensate it,” he said.

The Minister said that in the first two years when the Central government earned an extra cess of ₹47,000 crore, which was supposed to be given as compensation, they kept it in their fund. “Today when the revenue has started decreasing, they started asking A-G that whether they are liable to give this amount to States or not,” Mr. Sisodia said.

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Printable version | Oct 27, 2020 3:17:48 PM |

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