The Goods and Services Tax (GST) has been severely affected by this year’s coronavirus pandemic, the Secretary of Finance said after the GST Council assembly on Thursday.
Finance Minister Nirmala Sitharaman held the 41st Assembly of the Council on Goods and Services Tax (GST).
States have been guaranteed payment of any loss of profits in the first five years of implementation of the GST as of July 1, 2017, the Central Goods and Services Tax Act; however, due to the Covid-19 epidemic, payment collection has increased.
At the meeting, two features were discussed for the payment of states, adding loans from the Reserve Bank of India (RBI).
The Finance Minister stated that the features discussed to close the GST deficit were for the existing fiscal year. The GST Council will discuss this issue in April next year.
The assembly was attended by Anurag Thakur, Minister of State (MoS) in finance rate, finance ministers from EU states and territories (UT) and senior government and state officials. After a 5-hour assembly, the GST Council held a video convention with the media.
“GST collection has been severely affected this year as a result of the Covid-19 pandemic. Under the GST reimbursement law, states will have to get reimbursement,” the finance secretary said at the conference.
Here are the highlights of video conferencing:
– The central government has released more than Rs 1. 65 crore lakh as a GST refund to the states for fiscal year 2019-20, adding Rs 13,806 crore for March. The total amount of reimbursement released for 2019-2020 is 1. 65 crore lakh Rs , while the amount raised Rs 95,444 million: Secretary of Finance
– The Attorney General has stated that the GST refund will have to be paid in a transitional era, from July 2017 to June 2022. Ajay Bhushan Pandey, GST Secretary of Finance
– As discussed through the Minister of Finance at the GST Council meeting in March, the Attorney General of India requested a legal recommendation on the subject, which stated that the reimbursement of GST would be paid for the transitional era from July 2017 to June 2022: Secretary of Finance Ajay Bhushan Pandey
India’s Attorney General has stated that the source of income will still have to be that the repayment deficit should be covered through the ins cesation fund, which in turn will have to be financed by a deduction from the offices: Finance Secretary Ajay Bhushan Pandey
– The reimbursement hole that occurred this year (should be Rs 2. 35 million rupees), is also due to Covid-19. The deficit in reimbursement due to the implementation of the GST estimated at Rs 97 billion rupees: Secretary of Finance at the 41st GST Council MEETING
– AG’s transparent view that the reimbursement hole may simply not be covered through India’s consolidated fund. : Finance Secretary Ajay Pandey
– Option 2 presented to the GST Commission that the entire compensated hole of the Rs 2. 35,000 GST this year can be met through the states, in consultation with the RBI. These features will be sent to states for a hearing within 7 days and will apply only for this training: Secretary of Finance
– The states have asked us to give them 7 consecutive days to think about the features. These features will only be available in the current year, the scenario would be reviewed next year. We may have another GST assembly soon: Finance Minister Nirmala Sithaaraman
– Once the settlement has been agreed through the GST Council, we can temporarily continue and delete the contributions and also take care of the rest of the fiscal year. These features will only be available for this year; In April 2021, the Council will take a decision on action for the fifth year: FM Sitharaman
– Some states would possibly prefer to download constant payments than go to the market to borrow more. The option was adapted as states can file an appeal based on the refund they expect to receive: FM Nirmala Sitharaman on GST reimbursement to the state
– In April-July 2020, the total reimbursement of GST payable is 1. 5 million Lakh rupees, as there is virtually no GST collection in April and May: Revenue Secretariat, Department of Finance
– The annual COMPENSATION requirement for the GST is estimated at approximately Rs 3 crores lakh, and the collection of the cessation at approximately Rs 65,000 crores, leaving us with an annual compensation hole of Rs 2. 35 lakh crores: Revenue Secy, Ministry of Finance
– Two-wheeled vehicles would possibly deserve to go to the GST board for consideration: Finance Minister Nirmala Sitharaman asked about GST relief for two-wheeled vehicles at the press convention of the 41st GST Council meeting
– The government will grant an additional 0. 5% of the remainder of the state borrowing limit under the FRBM Act as the moment component of Option 1. : FM Nirmala Sitharaman on GST refund to states
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