Bihar polls fallout? States may face a longer wait to settle GST issues
NEW DELHI: The government seems to be in no mood to negotiate with states, which rejected both the options offered by the Centre to get their GST compensation cess, and has indicated that the next GST council meeting will be conducted only after the Bihar polls.
“Majority of the states have opted for one of the options and have got their dues. So now the ball is in the court of those states who are yet to choose any option. I do not think that the GST meeting will happen before the election results are out,” a senior official from the Finance Ministry told this publication.
The Centre had evolved a special borrowing window to address the shortfall in the GST collection during the year 2020-2021. Together, 21 states and two Union Territories have opted for this special window involving back-to-back borrowing coordinated by the Ministry of Finance.
Last week, the Centre had borrowed Rs 6,000 crore and transferred it to 16 states as the first tranche of GST compensation under the special window borrowing.
However, the states including Kerala, West Bengal, Jharkhand, Punjab, Chhattisgarh among others which had not opted for any of the options were left behind.
These states are left without any compensation during the festive season and had thus sought an early GST meeting to resolve pending issues.
“To implement option1 without the GST Council formally deciding on the extension of compensation payments beyond five years is illegal. The GST Council should be convened and search for a consensus continued,” Kerala Finance Minister Thomas Issac had tweeted the previous day.
Officials say that the government is ready to accept if these states opt one of the options even now, else they have to wait longer for getting their portion of the collections.
“They still have a window open to choose one of the options. As the finance minister had said, states who want money cannot wait endlessly for consensus,” said the finance ministry official.