Nirmala Sitharaman, the finance minister of the country called Corona pandemic as an act of God. She gave this statement while addressing media after the 41st GST Council meet which took place today.
Sitharaman called the pandemic “an act of God” and an unforeseen factor that affected GST collection. She said “…This year we are facing an extraordinary situation. We are facing an act of God where we may even see a contraction”
The 41st GST Council meet took place in a situation when the states have been seeking compensation for revenue shortfalls amid the corona pandemic.
But instead of putting up the procedure to pay the compensation, the central government has put up an option to the state to borrow money from RBI.
“Government of India owes us ₹ 4,400 crore for a small state like Punjab for which the total salary bill is ₹ 1,800 crore. It is getting difficult for us to run the state,” Punjab Finance Minister Manpreet Singh Badal tweeted.
Under the law that governs goods and services tax or GST, states have been guaranteed payment for loss of revenue in the first five years since the GST came into force on July 1, 2017. This means states have been promised compensation for any revenue shortfall till 2022 – if they fell below 14 per cent annual growth since July 2017.
