E-Paper
Maharashtra raises claim of ₹15,178 crore for lockdown losses
Although the last instalment of ₹1,644.16 crore towards the GST compensation for the losses in 2019-20 was released by the Centre to Maharashtra on Monday, the compensation
Although the last instalment of ₹1,644.16 crore towards the GST compensation for the losses in 2019-20 was released by the Centre to Maharashtra on Monday, the compensation of ₹15, 178 crore for the losses in April and May is still pending. The losses are expected to mount to ₹24,000 crore by the end of July.
The Centre pays compensation to the state towards their losses in GST collection as part of the agreement between Centre and states when the regime was rolled out in July 2017. With the release of the last instalment accrued in February and March, the Maharashtra’s share in the compensation paid by the Centre in the last financial year touched ₹19,233.65 crore. Maharashtra tops the chart in GST compensation paid by the Centre in 2019-20, followed by Karnataka (which has received ₹18,628 crore) and Gujarat (₹14,801 crore).
In the wake of Covid-19 lockdown, the state has sustained heavy losses in the new financial year. “Our targeted monthly collection from GST is ₹9,708 crore. In four months, till July 20, we have received ₹12,907 crore. The losses in GST collection are expected to mount to around ₹24,000 crore till July 31. We have raised the claim of ₹15,178 crore for April and May, as part of the process,” said an official from the finance department.
Manoj Saunik, additional chief secretary, finance department, said, “What we have received from the Centre is the compensation meant for the previous financial year. The demand for compensation is raised every two months.”
Another official from the state government said that as the Centre too was facing a drop in collection, the compensation instalments are released late. “The compensation is given to all states from a separate corpus generated from the taxes on six commodities, including tobacco, motor vehicles and toll taxes. As the corpus fund has dried up owing to the lockdown, the release of funds is delayed. As the claims in new financial year are high due to the lockdown, they are likely to take longer,” said the official.
The state had criticised the Modi government for the delay in the release of GST compensation and share in the central tax. Leader of opposition in the legislative Assembly Devendra Fadnavis said on Tuesday the Centre has made special provision to pay the compensation to states. He said the leaders (from the state government) who were blaming the Modi government should now thank the Centre.
The state has sustained a heavy drop in tax revenue collection from various sources, including GST, over the past four months. The accumulated losses between March and July are estimated to be ₹55,000 crore.
