Finance Minister Sitharaman to soon address media on the outcomes of GST Council meeting held today. The meeting is delayed and still continuing.
With a view to boost consumer spending, the government announced LTC Cash Voucher Scheme & Special Festival Advance Scheme for the government employees. This will lead to expected demand generation of Rs 36,000 crore & aid employees during festive season: Smriti Irani
It was annoucned in the last GST Council meeting that the levy of Compensation Cess is to be extended beyond the transition period of five years, that is, beyond June 2022.
Centre announced to release compensation of Rs 20,000 crore to states towards loss of revenue during 2020-21 and an amount of about Rs 25,000 crore towards IGST of 2017-18 in the last meeting.
As the GST Council meeting is still in progress, the press briefing is delayed. The briefing will commence after the GST Council meeting gets over, said the Minirty of Finance.
Small taxpayers got some reason to cheer after the outcomes of the GST Council meeting was announced. It had been decided that small taxpayers will not have to file monthly returns and their compliance to provide HSN details for B2B transactions are also limited to 4 digits.
The decision is to be made is on the extent of borrowing and on the options given by states, said FM Sitharaman. While some question arose on the issue of law on compensation cess, the finance secretary clarified that the law requires compensation to be paid and the levy of compensation has been extended beyond 2022. Hence, the compensation gap remaining in 2022 will be paid and the question of law will be addressed.
Non-BJP ruled states are in disagreement with the Centre on the compensation issue. States were earlier given seven days’ time to think and respond over the proposal but the opposition-ruled states were in disagreement.
Former Minister of Finance P Chidambaram had said that it is unfair and unjust to ask state governments to borrow the money and the states must stand firm at the next meeting on 12 October. The liability to provide the GST compensation to the full extent falls on the central government thus the onus of finding the resources also falls on the central government, P Chidambaram had added in a tweet. The former finance minister had also complimented the 9-10 states that stood firm and rejected the two options given by the central government to bridge the gap in the GST compensation cess.
FM Sitharaman to begin press conference soon. All eyes are glued to the outcome to know whether the states and Centre came to a conclusion in today’s meeting.
FM Sitharaman earlier said that even if the states do not choose either of the two borrowing options, the Centre will find some way to provide them the compensation dues.
Decision to provide Rs 12,000 crore as 50 year interest-free loan to the States for capital expenditure will not only give filip to ongoing capital projects but also infuse demand, generate employment & enhance economic growth: Cabinet Minister Smriti Irani
It is for the first time when the GST Council discussed about the compensation cess to compensate shortfall. Earlier, the Centre had given two borrowing options to states.
About 10 states want a group of ministers (GoM) to review the proposals or get the council to consider a third option that involves the Centre and states sharing the burden of the borrowing proposed to bridge the deficit.
FM Sitharaman announced 50-year interest-free loans of Rs 1,600 crore for north-eastern states and Rs 900 crore of such loans for Himachal Pradesh and Uttarakhand. The amount has to be spent by 31 march 2021. Other states will also get Rs 7,500 crore loans in proportion to their share in Finance Commission evolution.
Earlier today, Finance Minister Nirmala Sitharaman announced that government employees can avail cash voucher for LTC if they can’t travel due to pandemic.
No consensus as drawn in the last meeting on the issue of borrowing to make up for compensation shortfall.
Finance Minister Nirmala Sitharaman will soon address media on the outcomes of the GST Council meeting at 7 PM.