State seeks Rs 240 cr towards CST compensation

The Orissa government has sought Rs 240.84 crore as compensation towards the loss of Central Sales Tax (CST) for the first half (April-September) of the current fiscal.

Based on the current trend of collection of CST in the state, the government is expected to demand a compensation of about Rs 480 crore for the current fiscal, finance minister, Prafulla Chandra Ghadai said.

Talking to the media, Ghadai said, the state government had sought Rs 380.17 crore for 2007-08 and Rs 483.29 crore for 2008-09.

Though the state received Rs 137.02 crore and Rs 425.4 crore for these two consecutive years, the Centre deducted Rs 47 crore in 2007-08 and Rs 57.9 crore in 2008-09 towards the abolition of form ‘D’.

It may be noted, through form ‘D’, the state government departments can purchase goods and services at concessional 4 percent CST. Since no benefit accrued to the state on this account, the government has argued that the deduction isn’t tenable and hence this amount may be released to the state.

The finance minister said, the proposed Goods and Services (GST) tax is likely to be implemented from 2011-12 as it wouldn’t be possible to implement the new taxation regime from April, 2010.The rate of GST to be collected is yet to be decided, he added.