Kerala FM seeks extension of GST compensation regime

Kerala Finance Minister Okay N Balagopal on Saturday pitched for extending the GST compensation past June subsequent yr as he highlighted that the state is already grappling with important income shortfall.

Addressing the media in New Delhi, the minister mentioned the state will not be getting its due within the wake of the 15th Finance Commission devolution suggestions.

Kerala will probably be receiving GST (Goods and Services Tax) compensation of over Rs 13,000 crore and one other one-time grant of over Rs 19,000 crore within the present fiscal ending March 2022, he famous.

In case the GST compensation ends subsequent yr, then the state will face additional income shortfall, he mentioned and expressed hope that the compensation regime can be prolonged.

The regime of paying compensation to states for income shortfall ensuing from subsuming their taxes akin to VAT within the uniform nationwide tax GST will finish in June subsequent yr.

However, the cess which is at the moment levied on high of the GST fee on sure luxurious and sin items to fund the compensation quantity for states will proceed to be levied until March 2026. The collections will probably be used to repay the borrowings that needed to be completed since 2020-21 to pay for state compensation.

Source

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