Extension of GST compensation period sought


 







Chief Minister Basavaraj Bommai on Thursday appealed to the Union Government to extend the Goods and Services Tax (GST) compensation period to states for three more years. Bommai, who met Union Finance Minister Nirmala Sitharaman in New Delhi on Thursday, said he discussed extending the GST compensation period to states beyond 2022 and also the GST dues to be paid to the state in instalments. Bommai said it would be of help if the compensation period is extended as the GST collection has not yet stabilised because of Covid-19.

The compensation loan would support the states for only the current financial year, but the impact made by the pandemic on revenue collection will be carried forward for the next few years, he said. A statement issued by the Chief Minister’s Office (CMO) said Bommai also asked Sitharaman to increase allocation to the state under the 15th Finance Commission.

The 15th Finance Commission, in its final report for 2021-26, had recommended a reduction in Karnataka’s share in tax devolution to 3.647 per cent as compared to 4.71 per cent recommended by the 14th Finance Commission, he said. Bommai urged the Union Minister to reconsider the criteria for sharing of resources between the states.

Bommai also said the Centre has not considered the 15th Finance Commission recommendation to award state-specific grants of Rs 6,000 crore to Karnataka for holistic improvement of water bodies of Bengaluru and Peripheral Ring Road project.

Bengaluru, the IT and startup capital of the country, has a major contribution to the national economy and improving infrastructure in Bengaluru can help to attract more investments, Bommai said and urged the Centre to provide funds for the city’s development.

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