The Parliamentary panel on Finance met on Friday and Opposition members raised the delay in payment of compensation for loss of revenue from implementation of GST since August to the States.

According to sources, Congress MP Manish Tewari, who is a member of the committee demanded that the panel should debate the delay in payment. Chairman of the panel, former Union Minister and BJP MP Jayant Sinha, however deferred the discussion, saying it can be done after the budget.

“There is a huge revenue shortfall of about ₹5 lakh crore and compensatory GST allowance is not being paid to the States. The panel should be debating this subject and its implications on India's federal polity. Instead its attention is being deflected by studying the road map to a five trillion economy,” one of the members said.

In November, five non-BJP States — Punjab, Rajasthan, Kerala, West Bengal and Delhi — had in a common statement flagged the issue saying that GST comprised nearly 60% of the tax revenues of States and several States were already facing deficits up to 50% of the total GST.

They said the deficits will disrupt the State budgets and bring all activities of the States to a grinding halt. Since then, Finance Minister Nirmala Sitharaman has repeatedly said the Centre will honour its commitment.

The standing committee is going on a five-day tour to Mumbai and Bengaluru from January 16-20. On January 17 the committee has a meeting with Reserve Bank Chairman Shaktikanta Das.

        Source: The Hindu