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Break the deadlock

GST compensation issue needs a pragmatic approach

GST Council | GST compensation | Shortfall in GST Revenues

Business Standard Editorial Comment  |  New Delhi 

Yet another meeting of the Goods and Services Tax (GST) Council ended without arriving at a consensus on the compensation issue. The impasse will affect the ability of the states, which are at the forefront of fighting the pandemic, to make necessary expenditure. This will not only hurt India’s fight against Covid-19 but also delay economic recovery. Though Union Finance Minister Nirmala Sitharaman has downplayed this as mere “differences” which need to be discussed, it is obvious that the stalemate is affecting Centre-state relations at a time when they should be working together to deal with multiple challenges. The Union government on Tuesday allowed 20 states to borrow Rs 68,825 crore. This will help these states in the near term but will not solve the problem.



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First Published: Wed, October 14 2020. 00:07 IST