THIRUVANANTHAPURAM: Around Rs 2,921.84 crore GS T compensation is due to the state for 2021-22 financial year(FY), while the Centre owes a cumulative balance of GST compensation of Rs 4,478.29 crore to the state after the GST system was launched in 2017, Finance Minister K N Balagopal informed the assembly.
During the 2021-22 fiscal till August 21, Kerala received a sum of Rs 4,122.27 crore, but the state is eligible for Rs 7,041.11 crore during this period, owing to a shortfall of Rs 2,921.84 crore in GST compensation. Similarly, the state is yet to receive balance of Rs 1,473.34 crore in 2020-21, Rs 25.79 crore in 2018-19 and Rs 57.32 crore in 2017-18, while the state received an excess of Rs 11.40 crore in 2019-20 fiscal, the finance minister said.
The state is being compensated for the loss of revenue arising on account of implementation of GST for five years out of the Compensation Fund as per Section 10(2) of the said Act. GST compensation for 2017-18, 2018-19, 2019-20 and 2020-21 financial years has already been paid to the state. The indirect tax regime had come into effect from July 1, 2017 and the compensation will end on June 30, 2022, unless the GS T council extends it.
At the last meeting of the GS T council in September Union Finance Minister Nirmala Sitharaman had expressed the Centre’s inability to extend the GST compensation to the state beyond June 2022. Kerala had then made a strong pitch for giving compensation to states for another five years in view of poor revenue situation.
State may go in for more borrowings
T’Puram: The present finacial situation warrants the state to borrow more to tide over the crisis, said Finance Minister K N Balagopal while concluding discussions on various finance bills in the assembly. The state has a debt of over Rs 3.2 lakh crore as of now. But the growth in debt was more during the period of UDF government in 2011-16.