Centre releases Rs 168 cr to J&K as GST compensation

Centre releases Rs 168 cr to J&K as GST compensation
Representational PictureFile/ GK

Srinagar: The Union Finance Ministry on Wednesday released Rs 168 crore as Goods and Services Tax (GST) compensation to Jammu and Kashmir to meet the shortfall in their revenue.

As per the official statement, the central government has released 17,000 crore as GST compensation to states/UTs of which J&K will receive Rs 168 crore as its share from kitty.

With this, the total amount of compensation released to the states/UTs during 2021-22 so far is Rs 60,000 crore, the Finance Ministry said in a statement.

As per the decision of the GST Council, a back to back loan of Rs 1.59 lakh crore has already been released in lieu of shortfall in the release of GST compensation during the current financial year.

The Centre has estimated the shortfall in GST compensation payable to the states in the current fiscal at Rs 2.59 lakh crore, of which about Rs 1.59 lakh crore would have to be borrowed this year.

The Centre expects to collect over Rs 1 lakh crore through cess on luxury, demerit and sin goods, which will be given to the states to compensate them for the shortfall in revenue arising out of the Goods and Services Tax (GST) implementation.

Tax collection is expected to exceed the target set in the Budget as collections have improved with the revival of the economy, according to experts.

GST collection surged to Rs 1.30 lakh crore in October, the second highest since its implementation in July 2017. The highest GST collection of Rs 1.41 lakh crore was recorded in April 2021.

This is the fourth time in a row when the GST collection was upwards of Rs 1 lakh crore. The mop-up from GST was Rs 1.17 lakh crore in September 2021.

Tax collections last month on goods sold and services rendered was 24 per cent higher than in October 2020, and up 36 per cent over 2019-20.

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