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Telangana CM urges Nirmala Sitharaman to release Rs 4,531 cr in GST dues

KCR says despite a higher tax devolution as per Union Budget 2019-20, the receipts by the state till November were actually lower than in the same period last year

B Dasarath Reddy  |  Hyderabad 

Telangana Rashtra Samithi (TRS) president K Chandrashekar Rao (KCR) during his swearing-in ceremony as the Chief Minister of Telangana, in Hyderabad, Thursday | Photo: PTI
Telangana Rashtra Samithi (TRS) president and Telangana CM K Chandrashekar Rao (KCR) | Photo: PTI

Telangana chief minister K Chandrasekhara Rao today urged Union Finance Minister to release Rs 4,531 crore in GST tax dues pending from the Centre.

In a letter to Sitharaman, Rao explained the state's position regarding the pending dues and the shortfall in Central devolutions.

"As per Union Budget 2019-20, the tax devolution to Telangana is Rs 19,719 crore, which is 6.2 per cent more than Rs 16,451 crore received by the state during 2018-19. But, the state has received an amount of Rs 10,304 crore only till November, which is lower by Rs 224 crore, or 2.12 per cent, than the (receipts during the) same period last year. So, instead of receiving an enhanced amount, the state has received less," Rao stated. while expressing fears of another reduction in tax devolution due to the economic slowdown, which has extended to the second quarter.

In a recent meeting with Central government officials in Delhi, the state's representatives were told that the shortfall in Central devolutions could be as much as 15 per cent due to the economic slowdown during the current financial year, Rao said.

According to the CM, the economic slowdown has already resulted in lower GST collections compared to the benchmark growth of 14 per cent, and an amount of Rs 1,719 crore is due as compensation as mandated under the GST Act. The state has received for the first four months only this financial year.

Rao added that there was a Rs 2,812-crore shortfall as the IGST settlement was done on the tax devolution formula of the Finance Commission, instead of that adopted for the IGST settlement during 2018-19.

"Due to the above reasons, the state is waiting for its legitimate dues of Rs 4,531 crore of GST, while at the same time it is also suffering due to a shortfall in tax devolution. I request you to kindly look into the matter and release the pending dues expeditiously so that the developmental programmes of Telangana do not suffer for lack of resources," Rao informed the Union Finance Minister in this letter.

First Published: Sat, December 07 2019. 21:45 IST
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