Bhubaneswar: The Odisha government is yet to receive over Rs 3,251 crore as part of GST compensation from the Union government, state Finance Minister Niranjan Pujari informed the Assembly, Monday. In a written reply to a question asked by BJD member Debesh Acharya, Niranjan Pujari said the Centre is yet to release GST compensation of Rs 1,167.50 crore due for the financial year 2021-22 and Rs 2,084.03 crore for the first three months of the current fiscal.
GST has been introduced in Odisha with effect from July 1, 2017 subsuming state taxes like VAT, entry tax, entertainment tax, forest development tax and central taxes such as central excise duty, service tax, CST and other taxes.
As per the provisions made in the Constitution, the states are to be compensated for any loss on account of the introduction of GST for a period of five years which ended June 30, 2022, Pujari informed.
For the purpose of compensation, collection of the taxes subsumed in GST in 2015-16 has been taken as the base year collection. A growth rate of 14 per cent is applied annually to the collection made in the base year to determine the projected collection/protected revenue in a year, said Pujari.
Actual collection is deducted from the protected revenue to determine the compensation amount. The base year collection i.e. collection for FY 2015-16 in Odisha was to the tune of Rs 11,049.34 crore.
Applying the growth rate of 14 per cent per annum, the protected revenue for the year 2017-18 was calculated as Rs 14,359.72 crore. The Centre has released GST compensation of Rs 2,348.08 crore in the financial year 2017-18 against the protected revenue of Rs 10,769.79 crore, Pujari stated.
Similarly, he said, Rs 4,241.08 crore has been sanctioned to Odisha in 2018-19 against the protected revenue of Rs 16,370.08 crore while Rs 5,331.91 crore was released by the Centre during 2019-20 as GST compensation. The protected revenue was estimated at Rs 18,661.89 crore in the year 2019-20.
Due to Covid-19 pandemic, the Union government has sanctioned partial compensation of Rs 4243.42 crore against the protected revenue of Rs 21,274.55 crore during the financial year 2020-21. Moreover, the government of India has also released Rs 3,822 crore to the Odisha government as back-to-back loan to meet the GST revenue shortfall. In total, the state has received Rs 8,065.42 crore in the year 2020-21.
The state government is not required to pay towards the principal amount of back to back loan and interest accrued thereon, Pujari pointed out.
The protected revenue for the year 2021-22 was estimated at Rs 24,252.99 crore, of which the Centre has provided Rs 6,430.20 crore as back-to-back loan and the Odisha government has been demanding the Centre to release balance Rs 1,167.50 crore dues.
Moreover, for the first three months of the current financial year, the protected revenue is estimated at Rs 6,912.10 crore and the state has collected Rs 4,828.07 crore so far. Accordingly, the revenue shortfall for the first three months of the current FY is estimated at Rs 2084.03 crore, which is due till date, informed the finance minister.
