Centre sanctions Rs 2,228 crore as compensation against pending GST arrears to Punjab

The Centre has sanctioned the release of Rs 2,228 crore as grant-in-aid for Punjab against pending GST arrears of the state government since August.

The amount is aimed at compensating the Punjab government for loss of revenue for the months of August and September 2019 on account of implementation of the Goods and Services Tax (GST).

A communique in this regard was received on Monday by the Punjab Finance Department from the Department of Revenue (State Taxes) of the Union Finance Ministry, according to an official statement here.

The communication from the Centre comes amid repeated efforts by the state government, including Chief Minister Amarinder Singh, to press the Union Government to release pending GST payment.

Earlier, Amarinder had expressed shock over the delay in the release of Rs 4,100 crore of GST compensation to the state and sought the intervention of Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman in the matter.

"Shocking that the Centre is delaying the GST compensation amounting to Rs 4,100 crore as compensation & arrears to Punjab. Urge PM @narendramodi ji & FM @nsitharaman ji to intervene & solve the problem which has the potential to bring governance of the state to a grinding halt," Singh had tweeted on November 24.

His remarks came days after Punjab Finance Minister Manpreet Singh Badal, along with the finance ministers of West Bengal, Kerala, Delhi and Rajasthan, appealed to Sitharaman to release GST compensation without any delay.

On November 20, Manpreet Badal had attended the meeting of the Empowered Committee of state finance ministers at New Delhi.

In a joint statement, they had said, "GST compensation for the month of August and September, required to be paid by the central government, sometimes in October, continues to be outstanding till date."