CHENNAI: Chief Minister MK Stalin on Friday urged the Union government to immediately release Rs 20,860.40 crore dues pending under GST compensation and other government schemes so that Tamil Nadu could overcome the fiscal crisis. He made this demand during his meeting with Union Finance Minister Nirmala Sitharaman in New Delhi.
The State government is facing severe financial stress despite fall in Covid-19 cases. The pandemic necessitated additional expenditure towards upgrading of health infrastructure; purchase of medical equipment and drugs; and implementation of welfare schemes for the vulnerable, the Chief Minister said in the memorandum submitted to the Union minister.
He sought early release of the balance basic grant of Rs 548.76 crore and Rs 2,029.22 crore as performance fund under the local body grant recommended by the 14th Finance Commission. Stalin said the State, during GST’s introduction, had accepted to forego its fiscal autonomy with an assurance from the Centre that its revenues would be protected. In the last five years, however, there is a gap between actual revenues realised and the protected revenues guaranteed.
“This trend was visible even before the pandemic and the gap has been widening ever since. The State’s revenues are yet to recover despite easing out of the pandemic. At this juncture, the GST compensation period is coming to an end on June 30. Consequently, in the coming financial year, Tamil Nadu will face a revenue loss of approximately Rs 20,000 crore. So, the period of compensation should be extended by at least two years beyond June 2022,” he added.
CM’s wish list
Chief Minister MK Stalin on Friday called on Union Minister of Commerce, Industry, Consumer Affairs, Food, Public Distribution and Textiles Piyush Goyal and made these demands: