Covering GST loss- Government seeks Parliament nod
for Rs 63,000 crore
NEW DELHI: The Centre on Thursday sought
Parliament’s approval for extra spending of Rs 85,315
crore, a large chunk of which will be used to compensate
states for revenue losses due to rollout of the goods
and services tax (GST) and phasing out of the central
sales tax.
The government presented the fourth supplementary
demand for grants in Parliament on Thursday and out of
the total cash spending, it sought approval for Rs
62,716 crore to compensate states and Union territories
due to revenue shortfall after GST rollout. This is a
transfer from the compensation fund to the public
account where GST cess on tobacco, soft drinks, luxury
cars and coal is parked.
Although the money is paid for “revenue loss”,
many states, which have higher collections than last
year, will also receive compensation as the Centre had
guaranteed 14% growth in revenues for five years.
The Centre sought Parliament’s approval for gross
additional expenditure of over Rs 9 lakh crore, some of
which would be matched by savings of some ministries. |
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“Of this, the proposals involving net cash outgo
aggregate to Rs 85,315 crore and gross additional
expenditure, matched by savings of the ministries and
departments by enhanced receipts/recoveries, aggregates
to Rs 8,21,519 crore,” according to the document.
Among the major items of expenditure, Rs 9,260 crore was
for additional spending on pension in the defence
ministry. Over Rs 5,700 crore was for extra spending on
interest payments on market loans, special deposit of
nongovernment provident fund, gold monetisation scheme
and other programmes.
The government has already budgeted for a higher fiscal
deficit of 3.5% of GDP for the current financial year,
which ends in March. “A substantial part of the net cash
outgo proposed under the fourth batch of supplementary
demands for grants, 2017-2018, appears to be technical
in nature, led by the transfer of GST compensation cess
receipts into the non-lapsable GST Compensation Fund in
the public account,” said Aditi Nayar, principal
economist at ratings agency ICRA.
Source::: The Times of India,
dated 09/03/2018
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