The reduction in the share of states due to the improvement in the Goods and Services Tax (GST) collection during the last four months may be offset by about Rs 40,000 crore as against earlier estimates. Due to the huge reduction in GST collections, it was estimated that there would be a reduction of Rs 1.80 lakh crore in the share of states in GST revenue. Of this, a revenue loss of Rs 1.10 lakh crore is due to the implementation of GST, while a loss of Rs 70,000 crore is estimated due to the Kovid-19 epidemic.
The Center has set up a special window to compensate for the GST revenue loss of Rs 1.10 lakh crore that states share. The official said that we have made some calculations, which shows that in the current financial year, this reduction can be reduced by about Rs 30,000-40,000 crore.
The official further said that Rs 1.10 lakh crore will be borrowed through a special window and the additional amount will be used to compensate the loss of revenue due to Kovid-19. The Center has already released Rs 1 lakh crore to the states as GST compensation.
The official further said that the GST Council will decide on the system of compensation to the states for the next financial year from April 1 in its upcoming meeting in March. He said that the revenue deficit would be much lower in the next financial year compared to this financial year. However, it would be difficult to meet the target of 14 percent revenue growth.