No clarity on GST compensation to States as Council meet ends
- June 30, 2022
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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No clarity on GST compensation to States as Council meet ends
Subject : Economy
Section: Fiscal Policy
Context: GST council meet
Concept:
As per Section 18 of the Constitution (101st) Act, 2016, Parliament shall, by law, on the recommendation of the GST Council, provide for compensation to States for loss of revenue arising on account of implementation of the GST for five years from the date of its implementation. During the transition period, the States’ revenue is protected at 14 per cent per annum over the base year revenue of 2015-16.
Non-BJP ruled states such as Chhattisgarh want the compensation regime to be extended or the share of states in the GST revenues be increased to 70-80 per cent from the current 50 per cent.