The Narendra Modi government on Monday has told the Parliament that slightly over Rs 55,000 crore worth of Goods and Services Tax (GST) compensation is still pending to the states for the current fiscal. While the unpaid GST compensation for the last financial year has been calculated at a little over Rs 81,000 crore.
As per the reply of the union finance ministry to the Lok Sabha today, barring five northeastern states, the union government has yet to pay the rest of the states and UT's Rs 55,345 crore in what it calls "pending GST compensation for the period April, May 2021."
While between April-March FY21, barring four states from the northeast, the pending GST compensation amounts to Rs 81,179 crore.
The Centre borrowed Rs 1.10 lakh crore as back to back loans for states last fiscal to make up for the GST compensation gap. While this year, Rs 1.59 lakh crore will be borrowed to make good the compensation gap.
On July 15, the Centre released Rs 75,000 crore out of the Rs 1.59 lakh crore promised amount for this financial year. Except for this time, the Centre did not borrow fresh but released the same from its own market borrowings to make up for the compensation shortfall.
If the above-mentioned numbers are to be believed, the pending GST compensation to states so far stands at over Rs 1.36 lakh crore.
Meanwhile, the Centre clarified to the states last year that the unpaid GST compensation for FY21 will be cleared after July 2022 by extending the GST cess.
First Published: IST