08.08.2022: Chhattisgarh CM Baghel seeks extension of GST compensation for 5 years at NITI Aayog meet

Chhattisgarh Chief Minister Bhupesh Baghel on Sunday reiterated his demand to the Centre seeking a five-year extension for the compensation paid to states for revenue shortfall due to GST implementation.

He also  called for revising the rates of royalty for coal and other major minerals from the state.

Addressing the meeting of the seventh Governing Council of NITI Aayog chaired by Prime Minister Narendra Modi, Baghel said the state's demand of GST compensation, transferring of the amounts collected as ‘additional levy' from coal block companies and reimbursement of expenditure of Rs 11,828 crores made by the state government for eradication of Naxalism.
“There has been a loss of revenue to states due to the GST tax system and the Centre has not made arrangements to compensate the loss of revenue of about Rs 5,000 crore to the state in the coming year, so the GST compensation grant should be continued for the next five years after June 2022”, the chief minister was quoted as saying in a statement issued by his government.
When a nationwide GST subsumed 17 central and state levies from July 1, 2017, it was decided that states would be compensated for any loss of revenue from the new tax for five years, he said, adding the timeframe ended on June 30 this year.

When the GST was rolled out, states were promised compensation for revenue loss till June 2022. The compensation amount was raised from levying a cess on luxury, demerit and sin goods over and above the 28 per cent tax. Non-BJP ruled states, such as Chhattisgarh (Congress ruled), Kerala (LDF government) and Rajasthan (Congress ruled), have in the past also demanded that the compensation regime to be extended by five years, the statement said.

Baghel said Chhattisgarh has received Rs 13,089 crore less from the central taxes in the Union Budget of the last three years, resulting in extreme pressure on the resources of the state.

In the coming budget, the complete share of central taxes should be given to the state, he demanded Baghel also demanded that Rs 4,140 crore deposited with the Centre at the rate of Rs 294 per tonne on coal mining from coal block companies should be transferred to Chhattisgarh soon.

Source: MoneyControl

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