Pay Maha GST compensation dues of ₹15K-cr: CM to Centre

Maharashtra chief minister Uddhav Thackeray has written to Union finance minister Nirmala Sitharaman seeking “legitimate dues” of ₹15,558.05 crore from the Centre

Published on: Dec 11, 2019, 23:56:05 IST

By Swapnil Rawal, Mumbai

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Maharashtra chief minister Uddhav Thackeray has written to Union finance minister Nirmala Sitharaman seeking “legitimate dues” of ₹15,558.05 crore from the Centre towards the Goods and Services Tax (GST) compensation until November 2019.

In his letter, Thackeray has sought immediate release of the amount, to ensure development programmes of the state government do not “suffer”. Thackeray’s party, the Shiv Sena, has been vocal about the delay in payment of dues from the Union government after the GST regime came into effect in July 2017.

“The dues include ₹6,946.29 crore of tax devolution and ₹8,611.76 crore towards GST compensation,” the letter stated. “As per the Union budget 2019-20, the tax devolution to Maharashtra was ₹46,630.66 crore, which is 11.15% more than the ₹41,952.65 crore received by the state during 2018-19. But the state has received only ₹20,254.92 crore till October 2019, which is 25.53% less than the budgetary estimates of the year 2019-2020,” the letter added.

In the letter, the chief minister also expressed fear of a shortfall in GST collections compared to the benchmark growth of 14% owing to the slowdown in the economy. With further slowdown of the economy during the second quarter, it is likely that there will be further reduction in tax devolution. “Timely release of GST compensation and tax devolution amount will help my state to manage finances efficiently,” the letter stated.

State government officials said Maharashtra is under a debt of ₹6.70 lakh crore and needs funds so that the state can announce populist decisions, including farm loan waiver.

The letter further stated that Integrated GST (IGST) settlement was done during 2017-18, based on tax devolution formula of the Finance Commission, instead of the formula adopted for the settlement.

“As per the latest CAG report, for the year ended March 2018, the IGST settlement for many transactions is not happening,” the letter added.

ABOUT THE AUTHOR
Swapnil Rawal
Swapnil Rawal is Principal Correspondent with the Hindustan Times. He covers urban development and infrastructure. He had long stints with leading national dailies and has experience of over a decade in journalism.Read More

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