Opposition Parties protest outside Parliament, demand clearance of GST dues

On fourth day of Monsoon Session,  opposition protested in front of  Mahatma Gandhi statue in Parliament premises demanding immediate clearance of Goods and Services Tax (GST) payments to states. Holding posters and banners, MPs of several opposition parties demanded early payment of Goods and Services Tax (GST) to states amid a shortfall of revenue.

Raising slogan-- "We want compensation of GST," parties like  Telangana Rashtra Samithi (TRS), Trinamool Congress (TMC), Dravida Munnetra Kazhagam (DMK), Rashtriya Janata Dal (RJD), Aam Ami Party (AAP), Nationalist Congress Party (NCP), Samajwi Party and Shiv Sena stood outside Parliament premises threatening to take to streets if dues were t cleared. 

Rs 1.51 lakh crore due to states 

As per Minister of State for Finance Anurag Singh Thakur, GST collection during April-August declined on account of COVID-19 induced lockdown. Owing to this, compensation due to states stands at over Rs 1.51 lakh crore.  provisional GST compensation due to states/UTs for 2020-21 was highest for Maharashtra at Rs 22,485 crore, followed by Karnataka (Rs 13,763 crore), Uttar Presh (Rs 11,742 crore), Gujarat (Rs 11,563 crore) and Tamil Nu (Rs 11,269 crore).

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Centre suggests two options

Finance Ministry has rejected demand of multiple states and proposed two options for meeting shortfall in GST compensation. First, it suggested that states could borrow Rs.97,000 crore ( revenue shortfall arising on account of GST implementation and t taking into account COVID-19) with entire principal and interest repayment of debt to be met through cess collection in subsequent years. Moreover, states have been allowed to borrow an ditional 0.5% points under FRBM Act.

However, if states opt to borrow entire amount of Rs. 2.35 lakh crore, only principal amount shall be repaid from cess. In such a scenario, states will have to bear interest burden. Several CMs such as Delhi CM Arvind Kejriwal, Jharkhand CM Hemant Soren, West Bengal CM Mamata Banerjee, Tamil Nu CM Edappi Palaniswami, Kerala CM Pinarayi Vijayan, Telangana CM K Chandrasekhar Rao, and Chhattisgarh CM Bhupesh Baghel have written to PM Modi urging a rethink on GST compensation options.

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(With ncy Inputs)