GST Council meeting: opposition-ruled state governments start informal discussions

NEW DELHI: Disappointed over the Centre offering two “unacceptable” borrowing options at Thursday’s GST Council meeting to make up for the shortfall in GST compensation cess fund, some opposition-ruled state governments and the Congress leadership have started informal discussions on how to take up the issue of unpaid dues collectively and forcefully.

They are now in consultation on “bargaining collectively for dues as well as on conditions of borrowing” at the next week’s GST Council meeting. Some have even mooted a nascent idea of moving the Supreme Court, it is learnt. The Congress leadership is also keen to rally like-minded states against the Centre on the issue of GST dues.

Maintaining that the Centre’s stand was a violation of the commitment in the GST Act, Congress’ Jairam Ramesh tweeted: “Parliament passed a law that Centre will compensate states for GST shortfalls for 5 years. Centre is now passing the buck to states telling them they should borrow to make up shortfalls. This is abdicating Centre’s legal obligations. Pathetic! States should oppose tooth and nail.”


Chief ministers and finance ministers of some of the like-minded states are learnt to be in touch over the issue. Some of these states may make a compromise proposal at the next week’s meet by arguing that Centre’s borrowing option should not bifurcate dues into two compartments — as dues because of revenue losses due to transition to GST and revenue losses due to Covid-19-related lockdown. Given the urgent need for funds, some of these states are, as of now, wary of a legal course as it may be a time-consuming affair.