New Delhi: The government on Thursday said it has released Rs 75,000 crore to compensate states and union territories for shortfall in GST revenue. The GST Council, in its meeting on May 28, had decided that the central government would take a loan of Rs 1.59 lakh crore and release it to the states and union territories with legislatures. So that the resource crunch due to less compensation is released.
Due to insufficient amount in the Compensation Fund, less amount was released under Compensation Head. In a statement, the Finance Ministry said, “The ministry today released Rs 75,000 crore as loan facility against GST compensation to the states and union territories with legislatures. This is in addition to the normal GST compensation to be released every two months from the actual cess collection.
Agreed on funding to compensate for the shortfall in compensation
The statement said that all the eligible states and union territories (having the assembly) have agreed to finance (borrowing one after the other) to make up for the shortfall in compensation. According to the ministry, “All states and union territories have to play an important role in terms of capital expenditure for effective handling and management of the Kovid-19 epidemic.” To support the efforts of the states and union territories, the Finance Ministry today released Rs 75,000 crore (about 50 percent of the total estimated shortfall) for the financial year 2021-22. will be issued in
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