GST shortfall: Centre to transfer Rs 6,000 cr to 16 states, 3 UTs


Team Udayavani, Nov 2, 2020, 5:44 PM IST

New Delhi: The Finance Ministry on Monday said it will transfer Rs 6,000 crore as the second tranche of GST compensation shortfall to 16 states and 3 Union Territories – including Maharashtra, Bihar, Assam, Puducherry and Delhi.

The Centre had on October 23 transferred Rs 6,000 crore to 16 states and 2 UTs of Delhi and Jammu and Kashmir.

In the second tranche of transfer, Union Territory of Puducherry has been included.

“The Ministry of Finance, Government of India, under its ‘Special Window to States for meeting the GST Compensation Cess shortfall,’ will be releasing an amount of Rs 6,000 crore as second tranche to 16 States and 3 Union Territories today,” the ministry said in a statement.

This borrowing was done at an interest of 4.42 per cent, which is lower than the cost of borrowings for the states and UTs, thus benefitting them, it said.

“Ministry of Finance has facilitated loans of Rs 12,000 crore till date under the Special Window to States/UTs,” it added.

21 states and 3 Union Territories till date, have opted for the Special Window and the loans raised by the Centre would be released on a back-to-back basis to states/UTs, in lieu of GST Compensation Cess releases.

The loans have been released to the following states and Union Territories – Andhra Pradesh, Assam, Bihar, Goa, Gujarat, Haryana, Himachal Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Meghalaya, Odisha, Tamil Nadu, Tripura, Uttar Pradesh, Uttarakhand, Delhi, Jammu and Kashmir and Puducherry.

Last month, the Centre gave in to the demands of opposition ruled states to borrow and fund the GST compensation shortfall.

The Finance Ministry said that the Centre would borrow from the market to pay the GST compensation shortfall of Rs 1.1 lakh crore to states, and then act as an intermediary to arrange back-to-back loans to state governments.

This arrangement will not reflect in the fiscal deficit of the Centre and will appear as capital receipts for state governments.

The Centre had in August proposed two options to states: borrow Rs 97,000 crore (on account of GST implementation) from a special window facilitated by the RBI or the complete shortfall of Rs 2.35 lakh crore (including Rs 1.38 lakh crore due to COVID) from the market. The options have since been revised to Rs 1.10 lakh crore and Rs 1.83 lakh crore, respectively.

On Sunday, the Finance Ministry said GST collections in October stood at over Rs 1.05 lakh crore, crossing for the first time the Rs 1 lakh crore mark since February this year.

Among the states, Chhattisgarh has secured the first rank in the country in terms of the increase in GST collection by recording a 26 per cent rise over the same month last year.

As per the data issued by the Finance Ministry, GST collection in the Chhattisgarh for October 2019 was Rs 1,570 crore, whereas, in October 2020, it has increased to Rs 1,974 crore, an increase of Rs 404 crore.

During the lockdown, production in steel industries and work in coal mine also went on uninterrupted in the state.

Udayavani is now on Telegram. Click here to join our channel and stay updated with the latest news.

Top News

“Coming soon.. 2025”: KL Rahul and Athiya Shetty announce first pregnancy

Unauthorized bus stops at signals fuel traffic woes and safety concerns

SC notice to Karnataka, DK Shivakumar on CBI plea against withdrawal of consent by state govt

Will remain active in politics till my last breath: JD(S) patriarch & ex-PM Deve Gowda

BJP calls Congress govt ‘laughing stock’ as ‘samosa politics’ heats up in Himachal

Chikkaballapur: Yoga teacher feigns death by holding her breath, escapes murder bid

World Bunts Summit to be held in Mumbai on December 7

Related Articles More

No greater feeling than serving those in need: Outgoing CJI D Y Chandrachud

CJI Chandrachud: A legacy of landmark verdicts that shaped society and some controversy too

Akhilesh Yadav attacks BJP on demonetisation anniversary

DeMo paved way for monopolies by devastating MSMEs, informal sector: Rahul on note ban anniversary

Comply with order allowing minority student to attend St Stephen’s College: HC tells DU

MUST WATCH

Gho Pooja in Deepavali Festival

Melukote Deepavali

Ganapathi Co-operative Society Ltd

Udayavani Chinnara Banna 2024

Annapoorna Aahar | Food Places In Mysore


Latest Additions

“Coming soon.. 2025”: KL Rahul and Athiya Shetty announce first pregnancy

Unauthorized bus stops at signals fuel traffic woes and safety concerns

No greater feeling than serving those in need: Outgoing CJI D Y Chandrachud

Baikampady: Here, even elederly have to crawl under trains to cross tracks!

CJI Chandrachud: A legacy of landmark verdicts that shaped society and some controversy too

Thanks for visiting Udayavani

You seem to have an Ad Blocker on.
To continue reading, please turn it off or whitelist Udayavani.