In a bid to provide further relief to states amid the coronavirus outbreak, the finance ministry has released about Rs 34,000 crore in two phases to states as compensation for their revenue loss in the goods and services tax (GST) regime.
With the release of Rs 14,103 crore to states on Tuesday,the Centre has paid a total of Rs 34,053 crore pending GST compensation cessfor October and November, sources said.
The first tranche of Rs 19,950 crore for the period wasalready paid on February 17.
According to sources, the finance ministry is also lookingat the pending dues of states for December and January which could be releasedsoon in phases.
The government has released close to Rs 1.35 lakh crore tostates and union territories towards GST compensation cess.
Under GST law, states were guaranteed to be paid for anyloss of revenue in the first five years of the GST implementation, which cameinto force from July 1, 2017.
The shortfall is calculated assuming a 14 per cent annualgrowth in GST collections by states over the base year of 2015-16.Underthe GST structure, taxes are levied under 5, 12, 18 and 28 per cent slabs. Ontop of the highest tax slab, a cess is levied on luxury, sin and demerit goodsand the proceeds from the same are used to compensate states for any revenueloss.