Delhi may seek extension of cess collection till after 2022 at GST Council meet: Sisodia

New Delhi: With non-BJP ruled states opposing the GST compensation options offered to them by the Central Government and a fiery GST Council meeting scheduled for today (Monday), Deputy Chief Minister Manish Sisodia said that Delhi was not even presented with an option.

The 42nd GST Council meeting which is scheduled for 11 am today will see Sisodia, who is also Delhi's Finance Minister, demand an extension of cess collection till after 2022. Speaking to Millennium Post, he said, "Our demand is that the Centre should take a loan and give it states and that cess collection should be done after 2022," a position echoed by opposition-ruled states.

The Centre had in August given two options to states — either borrow Rs 97,000 crore from a special window facilitated by the Reserve Bank of India or borrow Rs 2.35 lakh crore from the market — and had also proposed extending the compensation cess levied on luxury, demerit and sin goods beyond 2022 to repay the borrowing.

Sisodia said that other states have selected option one of the two above-mentioned options. Delhi being a Union Territory does not have both options, i.e, it cannot borrow money from the RBI to meet the shortfall.

The Delhi government has a revenue shortfall of Rs 21,000 crore in the ongoing financial year.

After the last GST council meeting in August, Sisodia had said, "The central government should take a loan on our behalf as we also need to pay salaries to our doctors, teachers, engineers and other employees," adding that he was not against the idea of GST, but the Centre's way of implementing it.

Around 21 states, mostly ruled by the BJP or its allies have opted to borrow Rs 97,000 crore from the RBI to meet the GST revenue shortfall. Chief ministers of opposition-led states like West Bengal, Kerala, Delhi, Telangana, Chhattisgarh and Tamil Nadu — have written to the Centre opposing the options that require states to borrow to meet the shortfall.

They have not yet accepted the borrowing options offered by the Centre and are likely to demand an alternative mechanism for funding their GST compensation deficit. They feel that the constitutional liability of compensating the states lies with the Union government, according to public positions they have taken earlier.

In the current fiscal, the states are staring at Rs 2.35 lakh crore Goods and Services Tax (GST) revenue shortfall, of which the Centre claims about Rs 97,000 crore is on account of GST implementation and the remaining — Rs 1.38 lakh

crore — is owing to the

impact of COVID-19 on states' revenues.