Revenue shortfall: GST Council to bridge the gap between Centre and states

The goods and services tax (GST) Council will try to bridge the differences between the Centre and states over revenue shortfall of states and consequent compensation requirements. 

There is data discrepancy between states and the Centre on the estimated revenue that the former need to protect, Business Standard has learnt. 

According to sources, the revenue to be protected as calculated by respective accountant generals of states is on the higher side of what the Centre has estimated. The Centre has asked states to reconcile the discrepancy in data. 

Under the Compensation Act, states have been promised 14 per cent growth in their revenue every year with 2015-16 as the base year.

The revenue position and revenue gap for the Centre and states would also be debated. The monthly GST collection has not crossed the targeted Rs1 trillion a month except for March 2018 (collected in April). 

The council officials are scheduled to meet on Thursday, while the finance ministers of Centre and states would interact with each other on Friday through a video conferencing. 

In terms of state specific issues, Kerala has demanded exemption from Integrated GST levied on goods that are brought into Kerala from other states for the purpose of relief and rehabilitation for the flood-affected people. 

In addition, the coastal state has also proposed a cess over and above the GST, exclusively to address funding for rescue, relief and rehabilitation works in the state. However, the Council might take up imposition of cess across the country to help the state. 

Punjab, on the other hand, is batting for exempting the job works — the small services in the value chain that are outsourced mostly to the unorganised sector — across sectors from mandatory e-way bill requirement. 

Apart from these, the redressal of complaints relating to the IT system, especially those that pertain to filing of GST and transition refund claim forms — TRAN would be taken up for discussion. 

The council will also review anti-profiteering measures, and delve on specific cases with the National Anti-profiteering Authority.