Amid revenue shortfall due to the coronavirus induced lockdown and economic downturn, the Maharashtra Deputy Chief Minister Ajit Pawar, who holds the finance and planning department, on Friday urged the Centre to immediately release the pending GST compensation of Rs 24,000 crore for the year 2020-21.
Of the total pending compensation worth Rs 46,000 crore for 2020-21, the state has received Rs 22,000 crore while Rs 24,000 crore is still pending.
‘’Considering the financial position of the state in Covid pandemic, balance compensation may be given immediately,’’ said Pawar in his presentation at the virtual 43rd GST Council meeting chaired by the union finance minister Nirmala Sitharaman.
Pawar said during the current financial year 2021-22 Maharashtra state is grappling with covid-19 situation and lockdowns. ‘’Assumptions for calculating GST compensation appear to be over optimistic. It is requested that they may be re-examined and corrected so that the state receives adequate compensation and is not left with large arrears like in 20-21,’’ he noted.
Pawar made a strong case for increase in the period of revenue loss compensation. ‘’ Economic impact of pandemics cannot be nullified during one or two years hence it is proposed that revenue protection and compensation for loss may be extended for another 5 years that is for FY 2022-23 to 2026-27,’’ he said.
According to Pawar, the amount collected out of various Cess and surcharges levied on petrol, diesel are exclusively available to the GoI (Approximately Rs. 3.30 lakh Crores in the FY2020/21). ‘’The revenue earned out of these proceeds may be suitably shared with States at this critical juncture to strengthen our fight against the current pandemic,’’ he noted.
Pawar argued that the entire country is going through a crisis of once in a century. The second wave of Covid has affected millions in the country and livelihood of the commons is shattered. In an already strained economy, the burden of Covid made the situation even worse.
‘’To cope up with the situation more efficiently, I propose tax relief with respect to COVID related medical supplies. The Covid pandemic costs more than 3 lakh lives across India. To overcome the pandemic and safeguard human life, the Government has rolled out Covid-19 vaccination. The vaccination program will be taken phase-wise. Against this backdrop, the state is fully committed to vaccinating all of its citizens. Against this background it is important that maximum relief be given with regard to the taxation of these items so that more and more lives are saved. I urge you to provide whatever concessions possible which shall remove any financial burden on citizens/state and at the same time reach more and more people, rich or poor,’’ he said.
He said medical grade oxygen, oxygen concentrator, pulse oximeter and covid testing kits are directly used in COVID intervention by common people and therefore tax rate reduction proposed before is proper.
