New Delhi (The Hawk): According to the Finance Ministry on Friday, the federal government has issued Rs 17,000 crore to the states as part of the remaining GST compensation, bringing the total amount released this fiscal year to over Rs 1.15 lakh crore.
According to a statement from the ministry, "With this release, the Centre has released, in advance, the total amount of Cess projected to be collected this year up until March-end eligible for payment of compensation to States."
The government implemented the Goods and Services Tax (GST) on July 1, 2017, and states were guaranteed compensation for any revenue losses resulting from the adoption of GST for a five-year term.
A cess is imposed on specific commodities in order to pay for compensating states, and the money that is collected from the cess is added to the compensation fund.
On November 24, 2022, the federal government made a payment of Rs 17,000 crore to the states and UTs to cover the remaining GST compensation for the months of April to June 2022. The statement said, "Including the aforementioned sum, the total compensation released to the states/UTs to date during the year 2022–23 is Rs 1,15,662 crore."
This is true despite the fact that the total amount of Cess collected up until October 2022 was only Rs 72,147 crore and that the Centre was releasing the remaining Rs 43,515 crore from its own funds, according to the ministry.
This choice was made to help the states manage their resources and make sure that their programmes, particularly the capital expenditures, are successfully carried out during the fiscal year, it was said.
(Inputs from Agencies)
