Baghel Writes to PM, Requests Extension of GST compensation Mechanism
- CM Bhupesh Baghel urges PM Modi to consider extension of GST compensation mechanism.
- Baghel earlier wrote to 17 counterparts of his urging solidarity.
- CG to face huge revenue loss if GST compesation scheme is nullified.
Raipur: In a bid to ampilfy his efforts to convince the centre to extend the period of compensation mechanism under the Goods and Services Tax (GST), Chhattisgarh CM Bhupesh Baghel has written to PM Modi.
In the letter he has mentioned about the discourse during the meeting held between Sitharaman and thr Chief Ministers and Finance Ministers of all states ahead the Budget 2022-23.Earlier on March 28, Baghel had written to his counterparts in 17 other states, including five ruled by the BJP and AAP-governed Delhi, seeking their support.
“Being manufacturing states, our contribution to the growth of the country’s economy is much higher than those states which have benefited from the GST regime due to higher consumption of goods and services, he said”
According to Baghel, If the GST compensation is not continued beyond June 2022, then Chhattisgarh is expected to face a revenue loss of approximately Rs 5,000 crore in the upcoming financial year.This would impact the revenue recipets in the upcoming fiscal which would squeeze funds for public welfare and development works.
He further asserted that after the introduction of the GST regime, the autonomy of states on tax policy has significantly reduced.Therefore, to recover from the adverse impact of COVID-l9 on the economy and till the time actual benefits of the GST regime are realised, states with similar interests should jointly request the Union government to continue the current mechanism of compensation for at least next five years, or devise an alternate temporary mechanism to compensate for the shortfall in revenue, he added.