Representational picture
Representational picture

BHOPAL: The state government is sinking deeper and deeper into the morass of debt as the Centre is denying the state its due share in the Goods and Services Tax (GST) collections. The Centre has withheld more than Rs 29,500 crore due to the state. In the past two fiscals, the state government took loans of Rs 75,717 crore to meet its needs. In the same period, the state received Rs 93,500 crore out of the Rs 123,000 crore of its share in GST. An amount of Rs 29,500 crore thus remains unpaid.

 Former finance minister Tarun Bhanot told Free Press that the Centre was treating the state unfairly. The entire GST collection goes to the Centre, but, when it comes to sharing it with the states, the Centre drags its feet. He said that the state’s share in GST revenue was 41 per cent, with the remaining 59 per cent going to the Centre. “The shares of the central and state governments should be equal,” he said.

Bhanot said that the state was thus suffering on two counts — lopsided sharing of revenue and withholding of dues. “This is grossly unjust,” he said. “Even if the Centre transfers the entire amount due under the present sharing formula, it would be enough. But even that’s not being done, plunging the state into a deep financial crisis,” he added. He alleged that finance minister Jagdish Devda was trying to hide the real status of the state’s financial health. Devda has told the Assembly that he will be making a statement on Financial Response Budget Management (FRBM).

The Centre has asked the state government to take one per cent more loan, but the interest will be paid by the state, not by the Centre. “This is injustice with the people of state,” Bhanot said.

FM ducks question

When Free Press asked the finance minister about the total receipts from the Centre, including GST and others, and the unpaid amounts at his press conference on Tuesday, he ducked the question.

Consistent shortfall

In FY 2018-’19, the state, against its share in GST of Rs 61,000 crore, got Rs 45,000 crore — a shortfall of Rs 16,000 crore. Similarly in the FY 2019-’20, the state should have received Rs 62,000 crore, but got only Rs 44,000 crore — Rs 18,000 crore less than the due amount.

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Free Press Journal