Advertisement
Wednesday, Dec 08, 2021
Outlook.com
Outlook.com

Finance Ministry Releases Rs 44,000 Crore To States To Meet GST Compensation Shortfall

The Finance Ministry had earlier released Rs 75,000 crore in October and Rs 40,000 Crore in July. Till date, accounting the latest amount, it has released a total of Rs 1.59 lakh crore in the current fiscal year.

Finance Ministry Releases Rs 44,000 Crore To States To Meet GST Compensation Shortfall
Finance Ministry Releases Rs 44,000 Crore To States To Meet GST Compensation Shortfall
outlookindia.com
2021-10-28T17:32:29+05:30

Ministry of Finance announced on Thursday that it has released Rs 44,000 crore to states and union territories under the back-to-back loan facility meant to compensate them for the GST shortfall. The Ministry said the total amount released now in lieu of the GST compensation in the current financial year totalled Rs 1.59 lakh crore. It informed that the amount released is in addition to normal GST compensation released every two months out of the actual cess collection. 

The Ministry had earlier released Rs 75,000 crore in October and Rs 40,000 crore in July, this year. It stated the amount released would be funded from the Government of India's borrowing in five-year securities issued in the current financial year, at a weighted average yield of 5.69 per cent. "No additional market borrowing by Central Government is envisaged on account of this release," the ministry said. 

As per the ministry, the amount would help states and union territories in shaping their public infrastructure, taking up infrastructure projects and improving health infrastructure. 

It was decided after the 43rd GST Council Meeting that the central government would borrow Rs 1.59 lakh crore and disburse it to states and union territories on a back-to-back basis. This was aimed at helping the states meet the resource gap arising because of the short release of compensation as the compensation fund did not have adequate amount to process the same.  

Advertisement

Outlook Newsletters

Advertisement
Advertisement
Advertisement

Read More from Outlook

Why A Democratic India Must Junk Draconian AFSPA

Why A Democratic India Must Junk Draconian AFSPA

Experts believe the AFSPA has caused more harm to the Indian State in insurgency-hit areas than mitigating problems. Here’s why.

Nagaland Ambush: Not Just AFSPA, It’s Time To Do Away With Most Special Laws

Nagaland Ambush: Not Just AFSPA, It’s Time To Do Away With Most Special Laws

It may be time for India to uphold human dignity, take a hard look at some of its regressive laws like AFSPA which includes Special Laws that authorises detention without trial.

Ashes 2021-22: Australia Start Favourites - Statistical Preview

Ashes 2021-22: Australia Start Favourites - Statistical Preview

The Gabba has been like a fortress for Australia in the Ashes. The Aussies have a 12-4 win-loss record in Brisbane and they will do everything to protect that record.

Why AFSPA In Jammu And Kashmir Is Not Just A Defence Act

Why AFSPA In Jammu And Kashmir Is Not Just A Defence Act

Has the AFSPA become an ideological Act, a tool to revise Kashmir history? Many analysts believe so.

Advertisement