Extend GST compensation period for another 5 years beyond July 2022: Bengal

Kolkata: The Bengal government demanded the extension of the compensation period for GST for another five years beyond July 2022 during the 45th meeting of the GST Council held in Lucknow on Friday when the GST revenue has not yet stabilised and state finances are reeling under numerous stresses due to the pandemic and natural calamities.

State Urban Development and Municipal Affairs minister Chandrima Bhattacharya along with state Finance Secretary Manoj Pant attended the meeting of the GST Council. This is the first physical meeting of the GST Council that was held since the onset of Covid.

Sources added that Bhattacharya placed a series of demands in the meeting chaired by Union Finance minister Nirmala Sitharaman.

The most significant of all was the need for an extension of the GST compensation period for another five years beyond July 2022.

The GST was implemented on July 1 in 2017 and the Centre had assured states of compensating revenue losses incurred for a period of five years from the date of inception.

This comes at a time when the state is yet to get GST compensation worth around Rs 2,800 crore to Rs 2,900 crore from the Centre for the year 2020-21.

State Finance minister Amit Mitra wrote to Sitharaman in his letter dated June 5 and requested necessary steps be taken to extend the compensation period for another five years beyond July 2022.

Chief Minister Mamata Banerjee had repeatedly criticised the Modi government for implementing the GST hastily.

The extension of the period of the GST Council is essential as Bengal has faced the "double whammy" of the second wave of Covid pandemic and cyclone Yaas.

At the same time, the state government is yet to get a major part of the devolution and outstanding amount for the Central Sponsored Scheme.