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Centre doles out Rs 19,950 crore GST compensation to states, UTs

Finance Ministry said that over Rs 1.2 lakh crore has been paid as GST compensation this fiscal, despite cess collection of only 78,874 crore till January 31, 2019

twitter-logoBusinessToday.In | February 20, 2020 | Updated 22:40 IST
Centre doles out Rs 19,950 crore GST compensation to states, UTs

Centre paid Rs 19,950 crore as GST compensation cess to states and union territories earlier this week. In a statement on Thursday, Union government said that a total of Rs 1,20,498 crore has been paid as GST compensation to states and union territories in the current financial year, despite cess collection reaching Rs 78,874 crore till January 31, 2020.

Finance Ministry officials said Rs 95,081 crore was collected as GST compensation cess during financial year 2018-19, of which Rs 69,275 crore were released to the states and UTs. In FY 2018-19, total GST compensation cess of Rs 62,611 crore was collected in financial year 2017-18, out of which Rs 41,146 crore was released to the states and union territories.

ALSO READ:GST compensation to states delayed due to low realisation of cess, says FM Sitharaman

As on March 31, 2019, Rs 47,271 crore of the cess collected had remained unutilised after releasing GST compensation to the states and UTs for FY18 and FY19, Ministry officials said.

Earlier this month, Finance Minister Nirmala Sitharaman had compensation payment to states was being delayed due to inadequate realisation of GST compensation cess. At the time of the introduction of GST, it was agreed that the Centre would compensate states for the shortfall in GST collections as per a defined formula.

ALSO READ:Importers, exporters to mandatorily declare GSTIN in documents from Feb 15

Speaking at a media event, the Finance Minister had emphasised that there are signs of recovery in some sectors and GST collection has consistently been rising for the last three months.

Since November, she said, GST collection has seen a growth and the collection has been over Rs 1 lakh crore each in the past three months. This indicates revenue collection has improved, she had said.

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