It is good news for people of Assam, Meghalaya and Tripura as the states will receive GST compensation cess shortfall under a special borrowing window from the Finance Ministry.
The Centre on Monday released an amount of Rs 6,000 crore as a second tranche to states as their GST compensation cess shortfall under a special borrowing window.
The second tranche will be released to 16 states and two union territories, the Finance Ministry said in a statement.
In addition to Assam, Meghalaya and Tripura, the other states that have received GST compensation are Andhra Pradesh, Bihar, Goa, Gujarat, Haryana, Himachal Pradesh, Karnataka, Madhya Pradesh, Maharashtra, Odisha, Tamil Nadu, Tripura, Uttar Pradesh, Uttarakhand.
The two union territories which are getting the GST compensation cess shortfall under a special borrowing window are Delhi and Jammu and Kashmir.
According to the Finance Ministry, the borrowed amount will be transferred to the states as “back-to-back loan in lieu of GST compensation cess”.
On October 23, the government had transferred the first tranche of Rs 6,000 crore to several states and union territories to bridge the GST revenue shortfall.
The Finance Ministry has facilitated total loans of Rs 12,000 crore till date under the special window programme.
So far, 21 states and three UTs have opted for this special window involving back-to-back borrowing coordinated by the Ministry of Finance.
The facilities available to the states which choose Option-1 inter-alia include permission to borrow the final instalment of 0.5 per cent of GSDP out of the 2 per cent additional borrowings permitted by the government in view of the COVID pandemic, waiving the reforms condition.
The government will borrow Rs 1.1 lakh crore under the special window, the finance ministry earlier stated.
Total shortfall in GST collection is estimated at Rs 2.35 lakh crore, of which Rs 1.1 lakh crore is on account of GST shortfall.
