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Icra finds FinMin's estimates of GST compensation gap much smaller

Estimates by Icra put the total gap at Rs 2.92 trillion against the ministry's estimates of Rs 2.35 trillion

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States are assured compensation if their GST revenues do not grow 14 per cent on the base year of 2015-16.

3 min read Last Updated : Aug 29 2020 | 1:20 AM IST

The finance ministry's estimates on the revenue losses expected for the states are not in line with similar projections by experts.

The ministry estimated that the states would lose out Rs three trillion this financial year, of which Rs 65,000 crore could be given from the compensation cess. So, the gap stood at Rs 2.35 trillion.

Of this gap, Rs 97,000 crore is due to the implementation of GST and the remaining Rs 1.38 trillion due to the "Act of God" or Covid-19.

However, estimates by Icra put the total gap at Rs 2.92 trillion against the ministry's estimates of

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