Centre releases ₹1.04 lakh crore GST compensation shortfall to states since October 2020

The ministry on Monday released the 18th weekly instalment of ₹4,000 crore to 23 states and 3 Union territories with Legislative Assembly (Delhi, Jammu & Kashmir and Puducherry).

The Centre has released ₹1.04 lakh crore to states in four months since October 2020, to meet GST compensation shortfall, the finance ministry said on Monday.

Eighteen rounds of borrowings have been completed so far starting from October 23, 2020. (PTI)

The ministry on Monday released the 18th weekly instalment of ₹4,000 crore to 23 states and 3 Union territories with Legislative Assembly (Delhi, Jammu & Kashmir and Puducherry), taking the total amount released so far under the special borrowing window set up in October last year to ₹1.04 lakh crore.

The remaining 5 states, Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim do not have a gap in revenue on account of the goods and services tax (GST) implementation.

The Centre had set up a special borrowing window in October 2020 to meet the estimated shortfall of ₹1.10 lakh crore in revenue arising on account of the implementation of GST. The borrowings are being done through this window by the Centre on behalf of the states and UTs.

Under the special window, the Centre has been borrowing in government stock with tenures of 3 years and 5 years. The borrowing made under each tenure is equally divided among all the states as per their GST compensation shortfall.

"Till now, 94 per cent of the total estimated GST compensation shortfall has been released to the states and UTs with Legislative Assembly.

"Out of this, an amount of ₹95,138.08 crore has been released to the states and an amount of ₹8,861.92 crore has been released to the 3 UTs with Legislative Assembly," the statement added.

Eighteen rounds of borrowings have been completed so far starting from October 23, 2020.