Any reforms or rate changes under the Goods and Services Tax regime, including the much-awaited discussion between the Center and the states on higher fuel taxes, may have to wait until the end of May or June, as the GST Council is not expected to run the assembly. Meet before elections and new governments take charge in those five states.
Economic Affairs and Revenue Secretary Tarun Bajaj said, “Five states are going for elections and they are important states.” “Their participation in the GST Council is very essential,” he said.
The council headed by Finance Minister Nirmala Sitharaman has not met since October, when the issue of raising GST compensation for states was discussed in light of the hit on revenue due to epidemics and lockouts.
On the ₹ 63,000 crore of arrears owed to the states for GST compensation of 2020-21, Mr. Bajaj said it would be too early to talk on specifics but all dues would be paid.
“A decision has already been taken that on July 2022, whatever is left, the compensation cess will continue till it is paid. This is good in a way, because when the promise of 14% revenue growth from July 2022 will be gone, the revenue of some states may fall drastically. The fall may not be so low because of this; This will help them.
The Center will assess how long the compensation cess is to be levied after June 2022 to pay the outstanding GST arrears to the states and to bridge the gap between repayment of arrears of ₹ 1.1 lakh crore in FY 21 and outstanding cess receipts. For.
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