Opinion | Don’t drop the GST ball1 min read . Updated: 10 Dec 2019, 09:13 PM IST
Several states have complained that they are yet to receive monies collected by New Delhi through a cess created specifically to compensate them for losses
The Centre’s finances are under strain. Goods and services tax (GST) collections are reported to be 40% below the ₹526,000 crore amount budgeted for April to November 2019. This mirrors the GST shortfall being faced by states, who are complaining of delayed compensation by the Centre for the revenue they had to forgo upon switching to this tax regime in mid-2017. The chief worry is that India’s GST intake is not growing at the projected pace, which explains why states are demanding that they be compensated for longer than the five years agreed upon.
The GST Council is trying to make the tax yield more money. Unfortunately, administering it remains a work in progress. Its multiple rates are a cause of confusion. The administration is also grappling with a high compliance burden, and several sectors, especially export industries, are starved of cash because of refund delays. We hope that GST reforms aren’t lost sight of now that hauling the economy out of a rut has become the Centre’s principal policy imperative. After all, its messy implementation is among the factors suspected to have precipitated the slump in the first place.