India

GST: Kerala, Puducherry raise concerns over delay in compensation payment

GST: Kerala, Puducherry raise concerns over delay in compensation payment

Some states have raised concerns over delay in payment of compensation for August-September from the Centre under the Goods and Services Tax (GST) regime, which was due to be paid in October.

Kerala’s Finance Minister Thomas Isaac said the state has been pushed into severe ways and means crises due to the non-payment of compensation so far.

“State government has not so far received GST Compensation for October, pushing the treasury into severe ways and means crises. It is unfortunate that the Union Government is insensitive to the needs of state finance. Remember. GST Compensation is a statutory right of states,” Isaac posted on Twitter.

Similarly, Puducherry has also raised the issue of delayed payments for August-September.

Under GST, states are to be paid compensation every two months from the money raised from the levy of compensation cess on sin and luxury goods. Slowing GST revenues amid overall economic slowdown have raised concerns about revenue targets of states and Centre and the viability of compensation fund going ahead.