GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
LOK SABHA
UNSTARRED QUESTION NO- 212
TO BE ANSWERED ON MONDAY, 14th SEPTEMBER, 2020/BHADRAPADA 23, 1942
(SAKA)

GST Shortfall

212. MS. S. JOTHIMANI:

Will the Minister of FINANCE be pleased to state:

(a) the details of reasons for revenue shortfall in the Goods and Services Tax (GST);

(b) the details of options available to the States like Tamil Nadu to meet the revenue shortfall in GST collections and the objections from the States for the options;

(c) the measures which have been taken by the Government for fulfilling its moral and legal obligation to pay the compensation for the shortfall in GST collections to the States;

(d) the State-wise details of amounts disbursed under GST compensation as of date;

(e) whether the GST cess will be extended beyond 2022 and if so, the reasons therefor; and

(f) the details of decline in GST revenue, State-wise including Tamil Nadu and the reasons therefor?

ANSWER THE MINISTER OF STATE IN MINISTRY OF FINANCE (SHRI ANURAG SINGH THAKUR)

(a) & (f) Total net GST target (for centre, as per receipt budget document) has been pegged at Rs. 6,90,500 crore for 2020-21 in the general Union Budget, 2020-21. The actual net GST collection for the centre till August, 2020 is Rs. 1,81,050 crore, which shows 26.2% achievement (till August, 2020) of BE 2020-21 (the details enclosed at annexure-I).

The BE estimates for FY 2020-21 of GST in the Union Budget, 2020-21 were projected on the basis of assumption of higher growth of GDP, however as per CSO, MoS&PI press release [on 31st August, 2020], the Nominal GDP for Q1 (April-June), 2020-21 shows a contraction of 22.6% which is one of the major reason for revenue shortfall in GST. Other reasons for low tax collection inter-alia include nationwide lockdown measures implemented since March 2020 consequent to global Covid-19 pandemic which led to limited economic activities, extension of GST return filings timelines without payment of interest, late fee or penalty etc.

(b) & (c): As per provisions in Section 7 of the GST (Compensation to States) Act, 2017 loss of revenue to the States shall be calculated and released at the end of every two months’ period, for 5 years. Accordingly, admissible GST compensation for the period April, 2019 to March, 2020 has been released to all States/ UTs including Tamil Nadu. Due to short GST Compensation Cess collection in the current financial year, GST compensation is yet to be paid for the period April-July, 2020.

Accordingly, issue of pending GST compensation and future course of action to meet the GST compensation shortfall has been discussed in 41st GST Council meeting on 27.08.2020 wherein States were given two options to meet their GST compensation shortfall for current FY from market borrowing. It was also decided that States will give their preference views thereon. Thereafter on finalization of scheme, the states can choose either Option 1 or Option 2 and accordingly, their compensation, borrowing, repayment etc. will be dealt as per their individual choice. The Chief Minister of Tamil Nadu vide his letter dated 31.8.2020 had requested the Hon’ble Prime Minister that Government of India can raise the required funds as a loan and lends it to the GST compensation fund against future cess receipts, so that the GST compensation can be paid in full to the States in 2020-21.

(d) State wise detail of GST compensation disbursed is as per Annexure II.

(e) Section 18 of Constitution (One Hundred and First Amendment) Act, 2016 provides for payment of GST compensation to the states, on the recommendation of the GST Council, for loss of revenue arising on account of implementation of GST for a period of five years.

(f) The details of decline in GST revenue (domestic) State-wise are as per Annexure-III

********

ANNEXURE I

GST Collection since inception

(Rs. In crore)
Tax Head
2017-18
2018-19
2019-20
2020-21
Revised Estimate (RE)
Actual
Revised Estimate (RE)
Actual
Revised Estimate (RE)
Actual
Bud-get Estimate (BE)
Actual-[April-August](Provisional)
CGST
221-400
203-261
5039-00
457-534
514000
494070
580-000
125308
IGST
161900
176688
50000
28945
9204
27580
GST Compensation Cess
61331
62612
90-000
95081
98327
95551
110500
28163
Net Collection
444-631
442-561
643-900
581-559
612327
598-825
690-500
181051

Source: Receipts Budget, PrCCA, CBIC

Annexure II

Details of GST Compensation

(Rs. in crore)

GST Compensation released in
S.No Name of
State/UT
FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21 Total
(1) (2) (3) (4) (5) (6) (7)
1 Andhra Pradesh 382 0 1840.76 1187 3410
2 Arunachal Pradesh 15 0 0.00 0 15
3 Assam 886 466 878.97 488 2719
4 Bihar 3041 2571 3524.78 2265 11402
5 Chatti-sgarh 1483 2261 3081.44 1877 8702
6 Delhi 157 4182 7436.00 2160 13935
7 Goa 252 476 818.70 329 1876
8 Gujarat 3687 6149 10646.52 5822 26305
9 Haryana 1199 2820 5453.43 2522 11994
10 Himachal Pradesh 539 2037 1877.33 1018 5471
11 J & K 1137 1462 2279.28 1230 6108
12 Jharkhand 1265 1029 1531.82 859 4685
13 Karnataka 6246 10754 14496.90 7266 38763
14 Kerala 1772 2884 5575.04 3514 13745
15 Madhya Pradesh 2511 2866 4530.78 2600 12508
16 Maha-rashtra 1488 8330 15018.13 6837 31673
17 Manipur 24 0 0.00 0 24
18 Meghalaya 124 73 101.45 65 363
19 Mizoram 0 0 0.00 0 0
20 Nagaland 0 0 0.00 0 0
21 Odisha 2019 3390 3928.78 1917 11255
22 Puducherry 333 592 862.29 338 2125
23 Punjab 4037 7129 8804.54 6310 26281
24 Rajasthan 2598 2176 4439.53 2675 11889
25 Sikkim 6 0 0.00 0 6
26 Tamil Nadu 632 3151 8922.03 5442 18147
27 Telangana 169 0 2263.16 791 3223
28 Tripura 129 155 171.00 159 614
29 Uttar Pradesh 2124 308 5179.52 3943 11555
30 Uttar-akhand 1283 2037 2477.38 1452 7249
31 West Bengal 1608 1977 4358.74 2479 10423
Total 41146.00 69275.00 120498.29 65-546.20 296-465.49

Annexure III

GST revenue, State-wise April-Aug 2020-21 YoY

State Code State/UT 2019-20 2020-21 Decline in %
1 Jammu and Kashmir 1680 1169 -30.5
2 Himachal Pradesh 3390 2219 -34.5
3 Punjab 6497 4580 -29.5
4 Chandigarh 821 578 -29.5
5 Uttarakhand 6327 3760 -40.6
6 Haryana 23975 15869 -33.8
7 Delhi 18524 11907 -35.7
8 Rajasthan 13576 10066 -25.9
9 Uttar Pradesh 27170 19563 -28.0
10 Bihar 5294 4081 -22.9
11 Sikkim 916 855 -6.7
12 Arunachal Pradesh 235 199 -15.4
13 Nagaland 122 136 11.5
14 Manipur 162 120 -25.8
15 Mizoram 128 72 -43.6
16 Tripura 276 270 -2.1
17 Meghalaya 645 459 -28.9
18 Assam 4062 3171 -21.9
19 West Bengal 18389 11781 -35.9
20 Jharkhand 10091 5967 -40.9
21 Odisha 13011 9889 -24.0
22 Chhattisgarh 10266 8549 -16.7
23 Madhya Pradesh 11626 9041 -22.2
24 Gujarat 32503 22049 -32.2
25 Daman and Diu 483 270 -44.0
26 Dadra and Nagar Haveli 777 482 -38.0
27 Maharashtra 75910 52154 -31.3
29 Karnataka 34362 24763 -27.9
30 Goa 1788 1012 -43.4
31 Lakshadweep 7 6 -17.7
32 Kerala 7861 5220 -33.6
33 Tamil Nadu 30528 19797 -35.2
34 Puducherry 758 544 -28.2
35 Andaman and Nicobar Islands 151 103 -31.5
36 Telangana 15949 11762 -26.3
37 Andhra Pradesh 11187 8237 -26.4
38 Ladakh 35
97 Other Territory 807 617 -23.5
99 Center Jurisdiction 399 629 57.6
Grand Total 390650 271979 -30.4

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