Centre releases 7th instalment of GST of Rs 6,000 crores to states
Dec 14, 2020
New Delhi [India], December 14 : The Ministry of Finance on Monday released the seventh weekly instalment of Rs 6,000 crore to the states to meet the Goods and Services Tax (GST) compensation shortfall, an official statement said here.
Out of this, an amount of Rs 5,516.60 crore has been released to 23 states and an amount of Rs 483.40 crore has been released to the three Union Territories (UT) with Legislative Assembly (Delhi, Jammu & Kashmir and Puducherry) who are members of the GST Council, informed the Ministry of Finance.
The remaining five states -- Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim -- do not have a gap in revenue on account of GST implementation, the Finance Ministry stated.
"Central government had set up a special borrowing window in October this year to meet the estimated shortfall of Rs 1.10 lakh crore in revenue arising on account of implementation of GST. The borrwoings are being done through this window by the Centre on behalf of the States and UTs," it said.
"The borrowings have been done in 7 rounds. The amount borrowed so far was released to the states on 23rd October, 2nd November, 9th November, 23rd November, 1st December, 7th December and 14th December," it further added.
"The amount released this week was the 7th instalment of such funds provided to the States. The amount has been borrowed this week at an interest rate of 5.1348 per cent. So far, an amount of Rs 42,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.7712 per cent," Union Finance Ministry stated.
The statement said in addition to providing funds through the special borrowing window to meet the shortfall in revenue on account of GST implementation, the Centre has also granted additional borrowing permission equivalent to 0.50 per cent of Gross States Domestic Product (GSDP) to the states choosing Option-I to meet GST compensation shortfall to help them in mobilising additional financial resources.
"All the States have been given their preference for Option-I. Permission for borrowing the entire additional amount of Rs 1,06,830 crore (0.50 per cent of GSDP) has been granted to 28 States under this provision," the Finance Ministry said in a release.
The amount of additional borrowing permission granted to 28 states and the amount of funds raised through special window and released to the states and Union Territories so far is annexed, it stated.
State wise additional borrowing of 0.50 per cent of GSDP allowed and amount of funds raised through special window passed on to the states/UTs till December 14 this year.
