New Delhi | Jagran Business Desk: Finance Minister Nirmala Sitharaman, along with Minister of State (MoS) Finance Anurag Thakur, chaired the 41st Goods and Service Tax (GST) Council meeting today. The meeting, which was held via video conferencing, was attended by Finance Ministers of states and union territories (UTs) and other officials.
The key agenda of the 41st GST Council meet would be to discuss the issue of the revenue compensation to states and find a solution to meet the gap between GST cess collections and the total compensation paid to the states. Earlier, Finance Minister Nirmala Sitharaman had said that the 41st GST Council will be "special" and it will consider a proposal to borrow money from the market to compensate states for their revenue shortfalls.
Here are the highlights from 41st GST Council Meet:
17:05 pm: Two-wheelers may merit to go to the GST council for a consideration: Finance Minister Nirmala Sitharaman on being asked about GST cut for two-wheelers during the media briefing of 41st GST Council meet
17:01 pm: Annual GST compensation requirement is estimated to be around Rs 3 lakh crores, and cess collection is expected to be around Rs 65,000 crores, leaving us with an annual compensation gap of Rs 2.35 lakh crores: Revenue Secy, Finance Ministry
1659 pm: During April-July 2020, total GST compensation to be paid is Rs 1.5 lakh crores, this is so because there was hardly any GST Collection in April and May: Revenue Secretary, Finance Ministry
16:57 pm: Once the arrangement is agreed upon by #GST Council, we can proceed fast & clear these dues and also take care of the rest of the financial year. These options will be available only for this year; in April 2021, the Council will review &decide action for 5th year: FM Sitharaman
16:55 pm: Option 2 presented to GST Council was that the entire GST compensation gap of ₹ 2,35,000 crore of this year can be met by states, in consultation with RBI. These options will be sent to states for a view within 7 Days & will apply for this fiscal year only: Finance Secretary
16:52 pm: States have asked us to give them 7 working days to think about the options. These options would be available only during the current year, the situation would be reviewed next year. We may have another GST meet soon: Finance Minister Nirmala Sithaaraman
16:50 pm: Two options of compensating states discussed at 5-hour long GST Council meeting, says Finance Minister Nirmala Sitharaman
16:46 pm: AG's clear opinion was that compensation gap cannot be met from India's consolidated fund. Option 1 presented to GST Council was to provide a special window to states, in consultation with RBI to provide Rs 97000 crores at a reasonable interest rate: Finance Secretary
Option 2 presented to GST Council was that the entire GST compensation gap of ₹ 2,35,000 crore of this year can be met by states, in consultation with RBI. These options will be sent to states for a view within 7 Days & will apply for this fiscal year only: Finance Secretary
16:45 pm: West Bengal FM’s proposal to devolve ether cesses to meet shortfall wasn’t raised today: Nirmala Sitharaman
16:40 pm: Compensation gap which has arisen this year (expected to be Rs 2.35 lakh crores), is due to COVID-19 as well. The shortfall in compensation due to the implementation of GST has been estimated to be Rs 97,000 crores: Finance Secretary
16:30 pm: As mentioned by Finance Minister in GST Council meeting held in March, legal views of the matter were sought from the Attorney General of India who said that GST compensation has to be paid for transition period from July 2017 to June 2022: Finance Secretary
16:30 pm: Central govt released more than Rs 1.65 lakh crore as GST compensation to states for FY 2019-20, including Rs 13,806 crore for March. Total amount of compensation released for 2019-20 is Rs 1.65 lakh crore, whereas cess amount collected was Rs 95,444 crore: Finance Secretary
16:28 pm: GST Collection has been severely impacted this year, due to COVID-19 As per GST Compensation Law, states need to be given compensation: Finance Secretary
16:22 pm: Finance Minister Nirmala Sitharaman's media briefing begins
15:30 pm: As the GST Council meeting is still in progress, the virtual media briefing is delayed. The briefing will commence after the GST Council meeting gets over. Inconvenience is regretted: Ministry of Finance
15:01 pm: Finance Minister Nirmala Sitharaman will address the media shortly
14:22 pm:
FM @nsitharaman is Chairing the 41st #GSTCouncil meeting via video conferencing. MoS @ianuragthakur and Finance Ministers of States & UTs and Senior officers from Union Government & States are present.
— Office of Mr. Anurag Thakur (@Anurag_Office) August 27, 2020
The meeting commenced at 11 AM in New Delhi today.@FinMinIndia @GST_Council pic.twitter.com/hoVp5ayWaZ
13:35 pm: Meanwhile, Bihar deputy Chief Minister Sushil Modi has also said the central government is "morally bound" to compensate states for the revenue shortfall on account of low GST collections in the wake of the COVID-19 pandemic
"It is the commitment of the central government to compensate the states for the shortfall in GST collections. Its true that it is legally not binding on the Centre, but morally, it is," he said
13:10 pm: In a tweet, Kerala Finance Minister Thomas Isaac on Wednesday said, "The solution to GST embroglio is Central Govt to empower GST Council to borrow for meeting the compensation requirement, if necessary through an ordinance, on the strength of future receipts of an extended levy of compensation cess beyond 5 years by an appropriate notification."
12:11 pm: Just In: Nirmala Sitharaman will address the media at 3 pm today: Finance Ministry
12:04 pm:
Finance Minister Nirmala Sitharaman chairing the 41st GST Council meeting via video conferencing in Delhi today. MoS Finance Anurag Thakur, Finance Ministers of States & UTs and senior officers from Union Government & States are also present in the meeting: Ministry of Finance pic.twitter.com/zmbHqbOvwt
— ANI (@ANI) August 27, 2020
11:29 am: According to PTI sources, the Centre is looking at options like "market borrowing, raising cess rate or increasing the number of items for levy of compensation cess"
11:10 am: Finance Minister Nirmala Sitharaman chairs 41st GST Council meeting via video conferencing
10:50 am: "Finance Minister Nirmala Sitharaman will chair the 41st GST Council meeting via video conferencing at 11 AM in New Delhi today. The meeting will be attended by MOS Anurag Thakur besides Finance Ministers of States and UTs and Senior officers from the Union Government and States," the Ministry of Finance tweeted
10:45 am: The 41st GST Council meet will begin at 11 am
Posted By: Aalok Sensharma
