Centre releases 13th instalment of Rs 6,000 cr to states to meet GST compensation shortfall
Centre releases 13th instalment of Rs 6,000 cr to states to meet GST compensation shortfall
Union Government today released the 13th weekly instalment of Rs 6,000 crore to the States to meet the GST compensation shortfall. Out of this, over Rs. 5,516 crore have been released to 23 States and over Rs 483 crore to the Union Territories of Delhi, Jammu and Kashmir and Puducherry who are members of the GST Council.
The remaining states of Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim do not have a gap in revenue on account of GST implementation.
Ministry of Finance in a tweet today said, "13th Instalment of Rs 6,000 crore released to the States to meet the GST compensation shortfall."
✅13th Instalment of Rs.6,000 crore released to the States to meet the GST compensation shortfall
— Ministry of Finance (@FinMinIndia) January 25, 2021
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Read more ➡️ https://t.co/VHVxK6qTcW@nsitharamanoffc@Anurag_Office@PIB_India @cbic_india @DDNewslive @airnewsalerts @GST_Council
Till now, 70 per cent of the total estimated GST compensation shortfall has been released to the States and UTs. Out of this, over Rs 71,099 crore have been released to the States and an amount of over Rs 6,900 crore to the three UTs with Legislative Assembly.
The Central government had set up a special borrowing window in October last year to meet the estimated shortfall of Rs 1.10 lakh crore in revenue arising on account of implementation of GST. The borrowings are being done through this window by the Central Government on behalf of the States and UTs. 13 rounds of borrowings have been completed so far starting from October 23, 2020.
The amount released this week was the 13th instalment of such funds provided to the States. The amount has been borrowed this week at an interest rate of 5.3083 per cent. So far, an amount of Rs 78,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.7491 per cent.
In addition to providing funds through the special borrowing window to meet the shortfall in revenue on account of GST implementation, the Government of India has also granted additional borrowing permission equivalent to 0.50 per cent of Gross States Domestic Product (GSDP) to the states choosing Option-I to meet GST compensation shortfall to help them in mobilising additional financial resources. All the States have given their preference for Option-I. Permission for borrowing the entire additional amount of Rs 1,06,830 crore (0.50 per cent of GSDP) has been granted to 28 States under this provision.