Left parties target govt over ’act of God’ remark on GST revenue shortfall
As per the Centre's calculation, the compensation requirement by states in the current fiscal would be ₹3 lakh crore, of which ₹65,000 crore is expected to be met from the cess levied in the GST regime
New Delhi: Left parties on Friday hit out at the government over its "act of God" remark on the shortfall in GST revenue and accused it of passing its burden on states.
The Centre on Thursday had placed before the GST Council two options for borrowing by states to meet the shortfall in Goods and Services Tax (GST) revenues pegged at ₹2.35 lakh crore in the current fiscal.
Briefing reporters after the 41st meeting of the GST Council, Union Finance Minister Nirmala Sitharaman had said that the economy has been hit by the COVID-19 pandemic, which is an 'act of God', and it will see a contraction in the current financial year.
"Central government must borrow if need be and pay the states their legitimate dues. Why should the states borrow? 'Cooperative Federalism'? Having destroyed the Indian economy now looting states. Divine intervention?" CPI(M) general secretary Sitaram Yechury asked on Twitter.
He, in a series of tweets, also said that a "mix of cronyism, incompetence and callousness has failed our people and destroyed their livelihoods and lives well before the pandemic. Blaming the heavens now".
The CPI(M) termed the Centre’s move to tell states to borrow from the Reserve Bank of India (RBI) to bridge this gap as “obnoxious.”
As per the Centre's calculation, the compensation requirement by states in the current fiscal would be ₹3 lakh crore, of which ₹65,000 crore is expected to be met from the cess levied in the GST regime. Hence, the total shortfall is estimated at ₹2.35 lakh crore.
CPI general secretary D Raja echoed Yechury’s sentiments and said that the GST compensation is a legitimate right of state governments as promised by the central government while enacting the GST Act.
"The finance minister’s averment that the pandemic is an ‘act of god’ and therefore, the central government is not liable to pay the compensation is blatantly incorrect and unethical," he said.
"At a time when state governments are already burdened by the slowdown in the economy and the additional spending as a result of responsibilities of managing the pandemic, asking state governments to borrow from the market is adding additional financial liabilities on the state finances," Raja said.
Both the parties alleged that “surreptitious attempt” by the Centre to run away from its responsibilities is not just unethical, but an affront on the federal structure of the country.
Catch all the Business News , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
MoreLess
First Published:28 Aug 2020, 07:59 PM IST
- Top Gainers
- Top Losers
- 52 Week High