The goods and services tax compensation paid to states by the central government declined to over Rs 11,900 crore during August-September, an official said.
The bi-monthly GST compensation paid during the June-July period was Rs 14,930 crore, nearly a fourfold jump from Rs 3,899 crore paid in April and May.
“Over Rs 11,900 crore has been released to the states from GST compensation fund during August-September after regular and ad hoc settlement of integrated GST fund,” an official told PTI.
The government collected a record Rs 1,00,710 crore from GST in September. The returns filed and taxes collected in October reflect purchase and sale activities of September. It settled Rs 15,107 crore to states GST from integrated GST as a regular settlement. Further, Rs 15,000 crore has been settled with the states from the balance integrated GST available with the central government on a provisional basis at the end of October. Total revenue earned by the state governments after the regular and provisional settlement was Rs 52,934 crore.
Ten states which are facing maximum revenue shortfall during April-August are Puducherry (42 percent), Punjab and Himachal Pradesh (36 percent each), Uttarakhand (35 percent), Jammu and Kashmir (28 percent), Chhattisgarh (26 percent), Goa (25 percent), Odisha (24 percent), Karnataka and Bihar (20 percent).
The states faced an average 16 percent shortfall in GST mop-up in the first year of implementation (July 2017-March 2018), which has come down to 13 percent during April-August of the ongoing financial year.
Finance Secretary Hasmukh Adhia held discussions with tax officials in six states—Punjab, Himachal Pradesh, Puducherry, Jammu & Kashmir, Bihar and Uttarakhand to shore up revenues.
While only six states—Mizoram, Arunachal, Manipur, Nagaland, Sikkim and Andhra Pradesh are facing revenue surplus in the ongoing financial year, 25 states are staring at a revenue shortfall and have to be compensated by the central government.
In 2017-18, the central government released Rs 41,147 crore to the states as GST compensation to ensure that the revenue of the states is protected at the level of 14 percent over the base year tax collection in 2015-16.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
