States demand pending GST compensation

NEW DELHI: At least eight states have asked the central government to expeditiously release the compensation promised to them for any revenue loss due to switchover to goods and services tax. The states have not yet received compensation for August and September. Moreover, compensation for October and November is due on December 10.

Finance ministers of Delhi, Punjab, Puducherry and Madhya Pradesh, and representatives of Kerala, Rajasthan, Chhattisgarh and West Bengal met Union finance minister Nirmala Sitharaman on Wednesday and said the delay in GST compensation transfer has put them in an acute financial position.

With compensation for the next period (October-November) due soon, the “government is under obligation to pay”, Punjab finance minister Manpreet Singh Badal said.


He said Sitharaman assured states that the compensation will be released as early as possible, but she did not specify any timeline.

Delhi deputy chief minister Manish Sisodia alleged that the Centre has delayed payment despite adequate money in the compensation fund. Around Rs 50,000 crore is there through cess collection, he said.

“We thought we will make appeal to the Union finance minister saying that she must personally look into this and not violate the constitutional provisions as passed by Parliament of India,” Sisodia said.

Madhya Pradesh commercial tax minister Brajendra Singh Rathore said the Centre owes nearly Rs 3,000 crore to the state for August-November.