Best printers for Home

Best Mixer Grinder

Best wired Earphones

Best 43 Inch TV in India

Best Wi Fi Routers

Best Home Theatre in India

Smart Watch under 5000

Best Laptops for Education

Best Laptop for Students

The <keyword id="6357307" type="General" weightage="80" keywordseo="central-government" source="Orion">central government</keyword> has released an amount worth Rs 17,000 crore to states and <keyword id="6357801" type="General" weightage="80" keywordseo="union" source="Orion">Union</keyword> territories towards the balance GST compensation for the period April to June 2022. The total amount of compensation released to the States/UTs so far, including thus Rs 17,000 crore, during the year 2022-23 is Rs 1,15,662 crore, the Ministry of Finance said in a statement on Friday. "This is despite the fact that total Cess collection till October 2022 is only Rs.72,147 crore and the balance of Rs. 43,515 crores is being released by the Centre from its own resources. With this release, the Centre has released, in advance, the entire amount of Cess estimated to be collected this year till March-end available for payment of compensation to States," the statement added. This decision was taken to assist the States in managing their resources and ensuring that their programmes especially the expenditure on capital is carried out successfully during the financial year. "Even in May this year, the Central Government had released Rs. 86,912 crores as provisional GST compensation to States for the period Feb-May'2022 despite the fact that there was only about Rs. 25,000 crores in the GST Compensation Fund, by making arrangement of funds of around Rs. 62,000 crores from its own resources," the statement said. Goods and Services Tax was introduced in the country with effect from July 1, 2017, and states were assured compensation for loss of any revenue arising on account of the implementation of GST as per the provisions of the GST (Compensation to States) Act, 2017 for a period of five years. For providing compensation to States, Cess is levied on certain goods and the amount of Cess collected is being credited to Compensation Fund. Compensation to States is being paid out of the Compensation Fund with effect from July 1, 2017. In other news, Union Finance Minister <keyword id="2640262" type="General" weightage="80" keywordseo="nirmala-sitharman" source="Orion">Nirmala Sitharman</keyword> has chaired a pre-Budget meeting with the finance ministers of all States and Union Territories today for taking their inputs and suggestions for the upcoming Budget for 2023-24. Besides Sitharaman and state/UT finance ministers, Union MoS for Finance Pankaj Chaudhary and <keyword id="1073554" type="General" weightage="80" keywordseo="bhagwat-karad" source="Orion">Bhagwat Karad</keyword>, secretaries from various arms of the Union finance ministry, Chief Economic Advisor Anantha Nageswaran, among others attended the meeting. The Budget for 2023-24 is likely to be tabled on February 1. Notably, it will be the last full Budget for Modi 2.0 government before the <keyword id="6355187" type="General" weightage="80" keywordseo="lok-sabha" source="Orion">Lok Sabha</keyword> elections to be held in April-May of 2024. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/india-uae-in-talks-for-rupee-dirham-denominated-bilateral-trade/articleshow/95766169.cms">India, UAE in talks for rupee-dirham denominated bilateral trade</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/forex-kitty-grows-for-2nd-consecutive-week-rises-2-54-bn-to-547-25-bn/articleshow/95767390.cms">Forex kitty grows for 2nd consecutive week; rises $2.54 bn to $547.25 bn</a>

Centre releases ₹17,000 cr as GST compensation to States/UTs

States which failed to submit their options before the <keyword id="3680839" type="PERSON" weightage="20" keywordseo="gst-council-meeting">GST Council meeting</keyword> in October will have to wait for at least two years to get compensation on Goods and Services Tax collection shortfall expected during the transition period, Finance Ministry sources said on Monday. The sources said that such states will have to wait till June 2022 to get compensation dues, subject to the condition that the GST Council extends the cess collection period beyond 2022. This is so because the Council is expected to adopt one of the two options given by the Centre to meet the <keyword id="2600993" type="PERSON" weightage="20" keywordseo="GST-compensation">GST compensation</keyword> needs of the states this year. The states which decide against operationalisation of the new <keyword id="9971535" type="UNKNOWN" weightage="20" keywordseo="gst-compensation-formula">GST compensation formula</keyword> will get their dues only to the extent of compensation cess collected in FY21 and distributed in proportion among all states and union territories. The balance shortfall will only be met from the collection of GST compensation cess beyond the five-year transition period that ends in June 2022. This will be subject to GST Council approval to the extension of compensation cess. The GST Council, in its 41st meeting on August 27, 2020, had decided to give its member-states two borrowing options to meet their compensation shortfall and a response time of 7 working days from the formal receipt of the detailed proposal on the options by email. Almost 15 states had submitted their options by September 15 and more have joined since. Option-1 on GST compensation brought before the Council last month allows states to borrow, under a special dispensation from the Reserve Bank of India, a sum of about Rs 97,000 crore shortfall calculated by the Centre that is directly on account of GST implementation. Option-2 allows states to borrow the entire projected GST compensation shortfall of Rs 2,35,000 crore (total shortfall of Rs 3 lakh crore minus Rs 65,000 crore collected as GST compensation cess) for FY21. So far, 21 states/UTs have expressed preference for Borrowing Option-1 proposed by the Centre. With GST Act requiring voting for any resolution regarding an option by at least 20 states, the move is expected to be adopted by the GST Council at its meeting next month. If this option is indeed adopted, all states would be able to move ahead and borrow under the scheme suggested by the Centre to meet their shortfall arising due to GST switchover. If states still opt out, they will have to wait to get full compensation. Among the 21 states/UTs which support the first option on GST compensation are Andhra Pradesh, Arunachal Pradesh, Assam, Bihar, Goa, Gujarat, Haryana, Himachal Pradesh, Jammu and Kashmir, Karnataka, Madhya Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Odisha, Puducherry, Sikkim, Tripura, Uttarakhand, and Uttar Pradesh. Manipur, the only state which had earlier opted for Option-2, later preferred to change it to Option-1. A few more states are, also, to give their borrowing option in a day or two. However, some of them like Jharkhand, Kerala, Maharashtra, NCT of Delhi, Punjab, Rajasthan, Tamil Nadu, Telangana, and West Bengal are yet to respond to the GST Council proposal to decide their options. Under the existing GST Act, compensation for shortfall in GST collections over an agreed formula is payable by the Centre for the first five years of the operation of the new tax system from July 2017 to June 2022. SEE ALSO: <a href="https://www.businessinsider.in/tech/news/top-ten-phishing-examples-and-tricks-used-by-companies-to-test-their-employees-cybersecurity-smarts/slidelist/78228072.cms">Top ten phishing tricks that companies are using to test their employees’ cybersecurity smarts</a> <a href="https://www.businessinsider.in/stock-market/markets/news/indian-tech-companies-hcl-tech-wipro-infosys-tcs-share-price-are-green-today/articleshow/78228700.cms">It’s not just the DWS deal, Morgan Stanley's outlook has painted HCL Tech green⁠ — along with TCS, Infosys and Wipro</a> <a href="https://www.businessinsider.in/tech/apps/news/google-hits-back-at-paytm-reiterates-that-repeated-policy-violations-will-lead-to-stricter-actions/articleshow/78229677.cms">Google hits back at Paytm ⁠— reiterates that ‘repeated policy violations’ will lead to stricter actions</a>

States not choosing GST compensation options by October will have wait another two years

The <keyword id="6355040" type="UNKNOWN" weightage="20" keywordseo="GST-Council">GST Council</keyword> will meet here on Thursday to take up the single-point agenda of <keyword id="9025375" type="UNKNOWN" weightage="20" keywordseo="GST-compensation-to-states">GST compensation to states</keyword> affected by delays in the release by the Centre, a government official privy to meeting agenda said. The meeting was earlier proposed in July, as announced by Union Finance Minister <keyword id="129243" type="PERSON" weightage="20" keywordseo="Nirmala-Sitharaman">Nirmala Sitharaman</keyword> after the first GST Council meeting in the backdrop of Covid-19 pandemic in June. "The Council will meet tomorrow with a single-point agenda to discuss the compensation cess. Any changes in the GST rates or cess structure would also relate to how timely compensation to the states could be released," the official said. Faced with sharp decline in GST collections due to the nationwide lockdown and disruptions in economic activities across the country, one of the options before the Centre is to pay <keyword id="2600993" type="PERSON" weightage="20" keywordseo="GST-compensation">GST compensation</keyword> to states by using a portion of its borrowings. The compensation has not been paid to the states since March. Even the compensation for March was delayed and paid in late July. A legal opinion on the matter sought by the Centre from the Attorney General earlier suggested that the former is under "no obligation to pay GST compensation shortfalls to the states" and it is the GST Council which has to decide on making good the shortfall in the goods and services tax compensation fund by putting sufficient amount into it. The AG had opined that the GST Council can recommend to the Centre to allow the states to borrow on the strength of the future receipts from the compensation fund, sources said. It would, however, be for the central government to take a final decision in the matter under Article 293(3) of the Constitution. "If there is need for borrowings to meet compensation to the states and who is going to borrow? How we are going to pay for it?" the Finance Minister had said about the Council meeting in June, hinting that the fall in revenues has become a huge cause of concern for the Centre to meet its liability towards the states as per the GST legislation. Under the GST law, states are guaranteed full compensation for any revenue loss for the first five years after the introduction of the Goods and Services Tax (GST) in July 2017. The compensation is the difference between actually revenue collected and projected revenue. The projected revenue is revenue growth of 14 per cent for the states per year over the base year 2015-16. As per the GST Act, full compensation to the states has to be paid for a period of five years till FY22 only through the compensation fund that gets its money through the levy of GST compensation cess on a few items. However, with the fund not getting enough collections since August 2019, the GST compensation to the states has been delayed. The Centre is now looking at getting GST Council nod for a mechanism to finance the compensation. The situation vis-a-vis the GST revenue has worsened in April 2020, with several states indicating a shortfall in collections to the tune of 80-90 per cent of the average monthly collections during this time of the year. In fact, Delhi has said its GST collections may end up at a mere Rs 300 crore in April as against a collection of Rs 3,500 crore in the same month previous year. Other states like Tamil Nadu, Assam, West Bengal, and Andhra Pradesh are also facing severe revenue decline due to shrinking economic activities during the Covid-induced lockdown. The problem has continued into May as well. With economic activity and GDP growth projected to remain subdued for most part of FY21, the Centre is looking at all possible means on how it could meet its constitutional obligation of compensating the states for their revenue losses. After February, when the Centre released GST compensation of Rs 19,950 crore for October and November 2019, the Centre has cleared dues for December, January and February only now. In late July, the Centre released Rs 13,806 crore to the states as compensation for their revenue losses in the GST goods regime for March 2020. "The total amount of compensation released for the year 2019-20 is Rs 1,65,302 crore whereas the amount of cess collected during the year 2019-20 was Rs 95,444 crore," a government statement had said. The monthly compensation requirement for the states in 2020-21 is pegged at Rs 20,250 crore, government sources said, which leaves a big gap between what needs to be paid and what is getting collected. Even in FY21, monthly cess collections could be at a low Rs 7,000-8,000 crore, or even lower. According to previous releases of the Finance Ministry, in the FY 2017-18, a total GST compensation cess of Rs 62,611 crore was collected, of which Rs 41,146 crore was released to the states/UTs as GST compensation. In the FY 2018-19, Rs 95,081 crore was collected as GST compensation cess, of which Rs 69,275 crore was released to the states and UTs as GST compensation. As on March 31, 2019, Rs 47,271 crore collected as GST compensation cess remained unutilised after the release of GST compensation to the states and UTs in the FYs 2017-18 and 2018-19. Since the end of August 2019, the central government has started realising the impending precarious position in paying the GST compensation to the states and UTs as the compensation cess requirement was twice of the average monthly cess collection. The sources said that though the GST Council also has the option to either bring in more items under the cess base by expanding the base of GST cess items, or to increase cess rate on the existing items. Any increase in compensation cess on a few items could yield only about Rs 2,000-3,000 crore a year. Therefore, the Council in its earlier meeting also discussed other options like forego full cess compensation, which was increasing @14% per annum, or to go ahead with whatever compensation is available. One more option looked at was to raise the tax rate on items through rationalisation via shuffling of slab rates. SEE ALSO: <a href="https://www.businessinsider.in/personal-finance/news/if-you-have-a-bank-loan-that-you-are-unable-to-pay-restructuring-is-on-its-way/articleshow/77391894.cms">If you have a bank loan that you are unable to pay, restructuring is on its way</a> <a href="https://www.businessinsider.in/finance/banks/news/loan-moratorium-still-ends-on-aug-31-while-supreme-court-gives-the-government-another-week-to-clarify-if-accrued-interest-should-be-waived/articleshow/77758597.cms">Loan moratorium still ends on Aug 31 while Supreme Court gives the government another week to clarify if accrued interest should be waived</a>

GST Council meet on Thursday to figure out how states will be compensated for delays in payment

New Delhi, Dec 4 () Finance ministers and representatives of opposition-ruled states on Wednesday met Union Finance Minister Nirmala Sitharaman and expressed their concern over delay in release of GST compensation which has put them in an acute financial position.
 The finance ministers of Delhi, Punjab, Puducherry and Madhya Pradesh and representatives Kerala, Rajasthan, Chattisgarh and West Bengal attended the meeting over delay in payment of compensation.
 Speaking to reporters after the meeting, Punjab Finance Minister Manpreet Singh Badal said, August and September compensation has not been released to states.
 "We discussed that issue with the Finance Minister. Even the compensation for next period (October-November) will be due now, so August-November. Government is under obligation to pay.
 "The Finance Minister assured us that the compensation will be released as early as possible but she did not specify any timeline, " he said.
 So far state have not got compensation for the month of August and September and post December 10, compensation for the period October-November will also be due.
 Delhi Deputy Chief Minister Manish Sisodia said it is not that compensation fund does not have adequate money, around Rs 50,000 crore is there through cess collection.
 "We thought we will make 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," Sisodia said after half an hour long meeting. DP DRR

Opposition-ruled states meet FM over delay in GST compensation

New Delhi, Feb 11 () The Centre has released Rs 81,043 crore as GST compensation to states for April-September 2019, Minister of State for Finance Anurag Singh Thakur said on Tuesday.In a written reply to a question in the Rajya Sabha, he said GST compensation cess collection has shown upward trend since October 2019.GST compensation cess of Rs 7,607 crore was collected in October, Rs 7,727 crore in November, Rs 8,331 crore in December and Rs 8,637 crore in January. For 2019-20, the amount targeted to be collected from cess in GST was Rs 1.09 lakh crore. Of this, Rs 70,534 crore has been collected between April-December 2019. The amount of GST compensation released to states for April-September 2019 stood at Rs 81,043 crore, Thakur said.For 2018-19 fiscal, the net collection of GST compensation cess stood at Rs 95,081 crore as against the target of Rs 90,000 crore. For full fiscal, the government had released Rs 81,141 crore to states as compensation.For 2017-18, the net collection from cess stood at Rs 62,612 crore, as against the target of Rs 61,331 crore. The compensation amount released to states was Rs 48,785 crore.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 on July 1, 2017. The shortfall is calculated assuming a 14 per cent annual growth in GST collections by states over the base year of 2015-16."For providing such compensation to states, compensation cess is being levied on certain luxury and demerit goods as per provisions in Section 8 of the GST (Compensation to States) Act, 2017, and compensation cess is being credited into a non-lapsable Fund known as Goods and Services Tax Compensation Fund which forms part of the Public Account of India," Thakur said. JD ANUANU

Rs 81,043 cr GST compensation released to states for Apr-Sep: Thakur

New Delhi, Dec 16 () Facing heat over delay in payment of GST compensation, the central government on Monday released Rs 35,298 crore to states to make up for the loss of revenue due to rollout of the Goods and Services Tax (GST).
 When GST was rolled out on July 1, 2017, states were through legislation promised to be compensated for the loss of revenue as not just their taxes such as VAT were being subsumed in the new levy but also their right to levy taxes was being snatched.
 The compensation amount was fixed at 14 per cent on top of revenue in the base year of 2016-17. The corpus for paying compensation was collected by levying a cess on top of GST rates on tobacco products, cigarettes, aerated water, automobiles, and coal. 
This compensation was to be released after every two months but the same was pending since August, drawing protests from states, particularly non-BJP ruled ones.
 "The central government has released GST compensation of Rs 35,298 crore to States and Union Territories today," the Central Board of Indirect Taxes and Customs (CBIC) said in a Twitter post.
 This comes just days before the 38th meeting of the GST Council - the highest decision-making body of the new indirect tax regime - on December 18, where the opposition-ruled states had planned to again raise the issue of delayed payments.
 Opposition-ruled states such as Punjab, West Bengal and Kerala have since last month upped the ante for the immediate release of GST Compensation Fund. Their finance ministers had also met Union Finance Minister Nirmala Sitharaman and the issue came up during the just-concluded Winter Session of Parliament.
Sitharaman had in press conferences and industry events acknowledged the dues but never mentioned timelines for making the payment.
 She had in the Rajya Sabha on December 12 stated that in 2017-18, the total cess collected was Rs 62,596 crore, of which Rs 41,146 crore was released to states. The remaining Rs 15,000 crore was accumulated in the Cess Fund. In the next year, Rs 95,081 crore was collected and Rs 69,275 crore released to states but "cess accumulated in the Fund was zero," she had said, according to a verbatim transcript of her speech available on the Rajya Sabha website.
 It wasn't clear how no money was accumulated in the Cess Fund in 2018-19 when, according to her, only Rs 69,275 crore out of Rs 95,081 crore was paid.
She also hadn't said what happens to the surplus that accumulates in the Fund.
 According to Sitharaman, during the current fiscal year that began in April 2019, cess collections till October 31 were Rs 55,467 crore but compensation released to the states was Rs 65,250 crore. "The Government of India has released Rs 9,783 crore more than the amount raised through cess collections (this fiscal)," she had said in the Rajya Sabha.
 On Monday, Sitharaman, speaking at a conference, assured states that the Centre will not "renege" on the promise of GST compensations.
 The delays to pass on the money are due to slippage in collections and the states have nothing to be embarrassed about, she said. "It is certainly their right, I am not denying. At the same time, I am also making it clear to say that I am not reneging on that. States will be given. We are certainly not reneging on it. I admit that the payments which had to go the compensation head have not been given for two months slot."
 "I do not want them (states) to feel embarrassed because it's not their fault nor is it personally my fault," she said, admitting that GST collections have been much lower than expectations.
 She attributed the dip in collections to a slip in GST filing due to natural calamities and also due to a slowdown in consumption that has a direct impact on the collections. DP ANZ ANU

Under fire, govt releases Rs 35,298 cr GST compensation to states

New Delhi, Nov 20 () Five opposition-ruled states on Wednesday 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. DP ANZ
MKJ

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

Mumbai, Feb 7 () Pegging the unpaid GST compensation to the states at Rs 60,000-70,000 crore for the October 2019-January 2020 period, rating agency Icra has said the GST compensation fund may see a shortfall of Rs 15,000-25,000 crore for 2019-20. The agency assesses the compensation for the losses related to the goods and services tax (GST), required by all the states for the period from October 2019 to January 2020, at Rs 60,000-70,000 crore, which the Centre would likely disburse in the March quarter. The Centre by law has to pay the states at 14 per cent annually for the first five years of the GST regime and the government had earlier projected an 18 per cent growth in collections for this year, while the same has been tepid at a little over 5 per cent till January. In the current financial year, the Centre released nearly Rs 1 lakh crore compensation to the states till September. According to Jayanta Roy, group head of corporate sector rating at Icra, the GST compensation required by all the states for the October 2019-January 2020 period is at Rs 60,000-70,000 crore, which the Centre is likely to disburse to them in the fourth quarter. Given the balance of around Rs 17,000 crore available in the GST compensation fund in December 2019, and the compensation cess of around Rs 28,000 crore estimated to be collected in the fourth quarter, this suggests a shortfall of Rs 15,000-25,000 crore in the compensation fund for 2019-20. Based on the trends in the cess collected and the amount of GST compensation released to the states during 2017-18, 2018-19 and 2019-20 till December 2019, Icra estimates the balance available in the GST compensation fund to be around Rs 17,000 crore. The Centre has pegged cess collection at Rs 98,000 crore in the Revised Estimate of 2019-20, of which Rs 70,500 crore have already been collected till December 2019, based on the data released by the Controller General of Accounts. This suggests that the Centre expects a further inflow of Rs 27,500 crore as cesses in the fourth quarter ending March. There was a steady increase in the compensation released to the states to Rs 35,300 crore for the August-September 2019 period, from Rs 17,790 crore for April-May 2019 period and Rs 27,960 crore for the June-July 2019 period. However, GST collection growth has been only 3.4 per cent during April-October 2019, and 7.7 per cent in the November 2019-January 2020 period. The Budget 2020 has indicated an additional transfer to the GST compensation fund, the balances due out of the collection of the previous years, in two instalments. Thereafter, transfers to the fund would be limited to collection by way of GST compensation cess. The GST Act prescribes the Centre to release the compensation on a bi-monthly basis. BEN HRS

GST compensation fund likely to fall short by Rs 25,000 cr in current fiscal: Icra

New Delhi, Dec 19 () GST compensation payment of nine select states, including Gujarat, Maharashtra and Kerala, is expected to double to Rs 60,000-70,000 crore in 2019-20, according to a report.
 The timing of release of such grants by the Government of India (GoI) to these states would critically affect their cash flows, ICRA said in a report. 
 The states are Karnataka, Kerala, Gujarat, Maharashtra, Punjab, Haryana, Rajasthan, Tamil Nadu and West Bengal, the report said. 
 ICRA also expressed apprehension that "the central tax devolution (CTD) to these states in 2019-20 could be Rs 595-770 billion (Rs 59,500-77,000 crore) lower than what the GoI has budgeted, which has emerged as a key revenue risk for the states in this fiscal."
 Accordingly, a reduction in capital expenditure below the budgeted level appears imminent in the current fiscal.
 Subdued economic growth and reductions in GST rates have resulted in a muted 3.7 per cent rise in the headline GST collections in April-November 2019. 
 ICRA expects the actual SGST collections in the current fiscal to be considerably lower than the level of revenues protected under the GST (Compensation to States) Act, 2017, which is calculated based on a 14 per cent annual growth rate on the base year (FY2016) revenues subsumed into the GST. 
 This would necessitate a significant rise in the GST compensation grants required by the states from the Centre, it said.
 The CTD to all the 29 states has recorded a YoY contraction of 2.7 per cent in April-October 2019, it said, adding, this is likely to reflect a portion of the adjustment for the higher-than-warranted devolution that was made by the GoI to the states in FY2019. 
 "The CTD to the states in FY2019 was presumably based on the GoI's FY2019 Revised Estimates (RE) of gross tax revenues of Rs 22.5 trillion. However, the provisional data for FY2019 had pegged the GoI's gross tax revenues at Rs 20.8 trillion, Rs 1.7 trillion lower than the RE for that year," it said. 
 Accordingly, the tax devolution to all the 29 states was higher than mandated by Rs 0.6-0.7 trillion, it said.
 Additionally, the report expects the GoI's actual gross tax revenues to trail the FY2020 revised budget estimates (RBE) of Rs 24.6 trillion by a considerable Rs 3.0-3.5 trillion. 
 "After factoring in the shortfalls in gross tax collections in FY2019 and the estimated gap in FY2020, the aggregate CTD to all the Indian states may be as much as Rs 1.7-2.2 trillion lower in the current year than what was budgeted by the GoI," it said. 
 Based on the combined inter-se share in Central taxes of the nine states of 35.3 per cent, it estimates the shortfall in CTD to these states in the range of Rs 595-770 billion in FY2020, posing a key revenue risk in the current fiscal. DP MR
MR

GST compensation required by 9 large states could double to Rs 70,000 cr in FY'20: ICRA

New Delhi, Feb 9 () The Centre will soon release another Rs 35,000 crore to states to compensate for the revenue loss on account of GST rollout, an official said.Under the Goods and Services Tax (GST) law, states are guaranteed compensation for revenue loss for 5 years if their revenue does not increase 14 per cent on the base year of 2015-16.There were no differences between the Centre and states with regard to compensation payment in 2017-18, 2018-19, and in the first four months of the current fiscal. However, with revenue mop-up from compensation cess falling inadequate, the Centre held back fund transfer to states for revenue shortage beginning August.Following this, states raised the issue with the Centre and in December 2019, Rs 35,298 crore was released as compensation for August-September."We will soon transfer another Rs 35,000 crore from the consolidated fund of India (CFI) to compensation cess fund in 2 instalments. The first tranche will be compensation for October-November," an official told .The excess collection from compensation cess in 2017-18 and 2018-19 was deposited in the CFI earlier and this will now be transferred back to the compensation fund, the official added. Finance Minister Nirmala Sitharaman in her Budget speech said it is decided to transfer to the GST Compensation Fund balances in two instalments. Under the GST structure, taxes are levied under 5, 12, 18 and 28 per cent slabs. On top of the highest tax slab, a cess is levied on luxury, sin and demerit goods and the proceeds from the same is used to compensate states for any revenue loss.The Centre has so far released about Rs 2.11 lakh crore as GST compensation to states since the implementation of GST on July 1, 2017.During July 2017-March 2018 Rs 48,785 crore was released, while between April 2018-March 2019, Rs 81,141 crore was paid to states. For April-May and June -July last year, Rs 17,789 crore and Rs 27,956 crore were released. Further, Rs 35,298 crore was paid to states as compensation for August-September 2019.In an interview to , Revenue Secretary Ajay Bhushan Pandey had said revenues from GST will have to increase in order to resolve the issue of compensation payment to states."Revenue will have to increase and for that only we are looking at rate rationalisation, addressing issue of inverted duty structure and increasing compliance. This will ensure that requirement of compensation is less," Pandey said. He further said the government is looking at monthly average GST collection of over Rs 1 lakh crore. JD RVK ANUANU

Centre to release another Rs 35,000 cr compensation to states soon

New Delhi, Dec 17 () The GST Council will meet on Wednesday to review the taxation structure for shoring up the revenue as lower-than-expected collections has led to a delay in compensation payment to states.
 Some of the states such as West Bengal have opposed any hike in cess rates or rate calibration amid a slowdown in the economy, stating that consumers as well as the industry are passing through a distressing time. 
 With the revenue shortfall looming large, there have been suggestions for raising GST rate and cess to meet the gap. 
 The GST Council headed by Finance Minister Nirmala Sitharaman had sought suggestions from states on review of GST and compensation cess rates on various items, rate calibrations for addressing the inverted duty structure, compliance measures other than those currently under implementation to augment revenue.
 In a letter to Sitharaman, West Bengal Finance Minister Amit Mitra said states have received letter from the GST Council wherein suggestions have been sought on review of items currently under exemption for shoring up GST revenues. 
 "This is indeed alarming. We should not in any way tinker with the rate structure or impose any new cess at a time when the industry and consumers are going through the most distressing times with 'stagflation' knocking at our door (stagnation accompanied by growing inflation)," Mitra said.
Many economists, including former RBI Governor Raghuram Rajan, have expressed fear of India getting into a slow growth high inflation or stagflation mode.
 Rising food prices pushed retail inflation in November to an over three-year high of 5.54 per cent, while industrial sector output shrank for the third month in a row by 3.8 per cent in October, indicating deepening slowdown in the economy.
 India's economic growth slowed to a 6-year low of 4.5 per cent in the July-September quarter. With inflation rising, fears of stagflation -- a fall in aggregate demand accompanied by rising inflation -- have resurfaced.
 "Instead of increasing or imposing new taxes or cesses the GST Council has to collectively find ways and means to provide relief to industry so that they are able to tide over the present crisis...the solution of additional resource mobilisation lies not in tinkering with the rate structure but focus on anti evasion and fraud detection measures," Mitra said.
 Facing heat over delay in payment of GST compensation, the central government on Monday released Rs 35,298 crore to states to make up for the loss of revenue due to rollout of the Goods and Services Tax (GST).
 When GST was rolled out on July 1, 2017, states were through legislation promised to be compensated for the loss of revenue as not just their taxes such as VAT were being subsumed in the new levy but also their right to levy taxes was being snatched.
The compensation amount was fixed at 14 per cent on top of revenue in the base year of 2016-17. The corpus for paying compensation was collected by levying a cess on top of GST rates on tobacco products, cigarettes, aerated water, automobiles, and coal. 
 The Central GST collection fell short of the Budget Estimate by nearly 40 per cent during the April-November period of 2019-20, according to government data.
 The actual CGST collection during April-November stood at Rs 3,28,365 crore, while the Budget Estimate was Rs 5,26,000 crore for these months.
 According to sources, the Finance Ministry has set a Rs 1.1 lakh crore monthly GST collection target for the remainining four months of 2019-20 financial year
 Revenue Secretary Ajay Bhushan Pandey had a video conference meeting with top tax officials and impressed upon them to step up measures to achieve direct and indirect tax collection targets.
 Officers have been particularly urged to ensure that during field enforcement drive and visits, no taxpayer is overreached or troubled, the source said. DP MR
MR

GST Council to meet on Wed amidst talk of rate hike to meet revenue shortfall

New Delhi, Dec 16 () Economic Advisory Council of the Fifteenth Finance Commission on Monday discussed issues related to GST stabilisation and possible ways to improve tax collection for additional resource mobilisation.
"Advisory Council was informed about submission of the 2020-21 report and now the Commission is on its next task of preparing the report for 2021-26 period," said an official release after the fifth meeting of the Fifteenth Finance Commission.
Talking to reporters, Finance Commission Chairman N K Singh said the Commission plans to make recommendations on Goods and Services Tax (GST), which will be for the GST Council to consider.
The Fifteenth Finance Commission discussed issues related to stabilisation of Goods and Services Tax (GST), relationship between GST Council and Finance Commission, and GST compensation being paid to states.
Singh also said the Commission was planning to make medium-term revenue projections in its report.
The Council discussed the possible macro assumptions for the Commission's award period relating to real growth, inflation etc were discussed in detail.
Matters like the structural shift in inflation, relationship between the GDP deflator and consumer price inflation, and possible trajectories of movement in real activity were also discussed.
"Tax revenues and expenditure patterns emerging both at the Union and the States level. Possible way to improve tax collection for additional resource mobilisation," the release said.
The meeting held detailed deliberations on tax revenues and expenditure patterns emerging both at the Union and the states level.
Possible way to improve tax collection for additional resource mobilisation was another focus area of the meeting.
As per the release, issues related to compliance and adherence to Fiscal responsibility legislations (FRLs) enacted by respective governments. The need for bringing in fiscal transparency was underlined in the discussions.
Advisory Council members were updated by the Commission regarding the additional terms of reference extending Fifteenth Finance Commission's term till October 2020.
As per the additional terms of reference, the Commission will submit two reports- one, for the year 2020-21 and second report for the five year period of 2021-22 to 2025-26.
The council members who attndeded the meeting include M Govinda Rao, Indira Rajaraman, Sudipto Mundle, Omkar Goswami, Arvind Virmani, Surjit Bhalla and Prachi Mishra. NKD
BAL

Eco Advisory Council of Fin Comm discusses GST stabilisation, tax collection issues

As the day for the presentation of <keyword id="6360189" type="General" weightage="80" keywordseo="union-budget" source="Orion">Union Budget</keyword> 2023-24 nears, Finance Minister Nirmala Sitharaman and her team of officials are burning the midnight oil to unveil the nation's record of income and expenses on February 1. IANS takes a look at the nine individuals who are the brains behind the annual exercise. <ul><li>Nirmala Sitharaman, Finance Minister</li></ul> Nirmala Sitharaman will be presenting her fourth Union <keyword id="6358021" type="General" weightage="100" keywordseo="budget" source="Orion">Budget</keyword> on February 1. She has helmed the Finance Ministry during the two tumultuous years of the Coronavirus pandemic and has piloted several economic relief packages, to help tide over the challenges posed by the pandemic. Sitharaman is now negotiating the risks to the domestic economy from the prevailing tricky global geopolitical situation as well as problems being posed by the ever-depreciating rupee. The forthcoming Budget would test her mettle, as she would have to come up with solutions to the various economic challenges being faced by the nation's economy. <ul><li>T.V. Somanathan, Finance Secretary</li></ul> The 1987-batch IAS officer from the Tamil Nadu cadre was earlier a Joint Secretary in the Ministry of Corporate Affairs and with the Prime Minister's Office (PMO) from 2015 to 2017. Under him, capital expenditure has surged and efforts are also on to boost the capex of states. Somanathan holds a doctorate in economics and is also a qualified chartered accountant (CA), cost accountant and company secretary. <ul><li>Ajay Seth, Economic Affairs Secretary</li></ul> The Karnataka cadre 1987-batch IAS officer is one of the most significant members of the Finance Minister's team, as the budget division, which collates all data, is under his watch. Seth also has the additional responsibility of co-chairing the G20 central bank and finance minister's meetings. <ul><li>Tuhin Kanta Pandey, Secretary in the Department of Investment and Public Asset Management (DIPAM)</li></ul> The Government in recent years has tempered its disinvestment targets, and even the Coronavirus pandemic has hit its plans. However, Tuhin Kanta Pandey can be credited for overseeing the Air India sale under his watch. <ul><li><keyword id="301743" type="General" weightage="80" keywordseo="sanjay-malhotra" source="Orion">Sanjay Malhotra</keyword>, Revenue Secretary</li></ul> A 1990-batch IAS officer of the Rajasthan cadre, Sanjay Malhotra was recently shifted to the revenue department from the department of financial services. He faces the arduous task of balancing revenue expectations, especially those related to GST compensation. <ul><li>Vivek <keyword id="6157" type="General" weightage="80" keywordseo="joshi" source="Orion">Joshi</keyword>, Secretary, Financial Services</li></ul> A new face in the ministry which governs the banking sector, Vivek Joshi came as a successor to Sanjay Malhotra in October last year. A 1989-batch IAS officer of the Haryana cadre, Joshi has a MA and PhD in international economics from the Geneva Graduate Institute. <ul><li>V. Anantha Nageswaran, Chief Economic Advisor</li></ul> V. Anantha Nageswaran became the Chief Economic Advisor (CEA) just days before the Budget for 2022-23 was presented. He will pilot the drafting of the economic survey for 2022-23, which will be tabled in the Parliament on January 31. Nageswaran has a PhD in finance from the University of Massachusetts Amherst and an MBA from the Indian Institute of Management (IIM), Ahmedabad. <ul><li>Nitin <keyword id="6356160" type="General" weightage="80" keywordseo="gupta" source="Orion">Gupta</keyword>, Chairman of CBDT</li></ul> Nitin Gupta is a 1986-batch Indian Revenue Service (IRS) officer, who heads the Central Board of Direct Taxes (CBDT), the administrative body of the income tax department. Gupta is currently serving as a member (investigation) in the CBDT. <ul><li>Vivek Johri, Chairman, CBIC </li></ul> Vivek Johri is the Chairman of the Central Board of Indirect Taxes &amp; Customs (CBIC) and special secretary to the Government of India.A An IRS (Customs &amp; Indirect Taxes) officer of the 1985 batch, Johri has served in a number of roles encompassing the entire gamut of indirect tax administration, especially in policy formulation. His tenure as a member (GST) saw many important changes carried out in GST law and procedure, both for easing the compliance burden on taxpayers and tighter enforcement for tackling tax evasion. He also played an active role in laying the policy foundation for rolling out GST and was instrumental in drafting the Constitution (115th Amendment) Bill, 2010 which laid the foundation for GST in India. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/budget/news/budget-session-of-parliament-from-january-31-to-april-6/articleshow/97061098.cms">Budget Session of Parliament from January 31 to April 6</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/gold-prices-hit-life-time-high-amid-looming-recession-hope-that-fed-will-slow-its-rate-hikes/articleshow/97061060.cms">Gold prices hit life-time high amid looming recession &amp; hope that Fed will slow its rate hikes</a>

You Searched For "gst compensation october" and got 13 results

Centre releases ₹17,000 cr as GST compensation to States/UTs

ANI

States not choosing GST compensation options by October will have wait another two years

IANS

GST Council meet on Thursday to figure out how states will be compensated for delays in payment

IANS

Opposition-ruled states meet FM over delay in GST compensation

PTI

Rs 81,043 cr GST compensation released to states for Apr-Sep: Thakur

PTI

Under fire, govt releases Rs 35,298 cr GST compensation to states

PTI

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

PTI

GST compensation fund likely to fall short by Rs 25,000 cr in current fiscal: Icra

PTI

GST compensation required by 9 large states could double to Rs 70,000 cr in FY'20: ICRA

PTI

Centre to release another Rs 35,000 cr compensation to states soon

PTI

GST Council to meet on Wed amidst talk of rate hike to meet revenue shortfall

PTI

Eco Advisory Council of Fin Comm discusses GST stabilisation, tax collection issues

PTI

Finance Minister & the other brains behind the Union Budget who are burning the midnight oil

IANS

Popular Keywords

Buying Guides