Chief minister Basavaraj Bommai said the Centre has transferred Rs 8,800 crore goods and services tax (GST) dues to Karnataka and the rest would be paid soon. He also said GST compensation to states is unlikely to be extended since the law stipulates that it is only for a period of five years. Several states, including Karnataka, had wanted compensation to be extended for another two years at least. Compensation was paid to states to make up for revenue shortfalls due to implementation of GST. Bommai, who heads the group of ministers on GST rate rationalisation, said the Centre has already indicated that this will not be extended. He said even his government had appealed to the Centre to extend GST compensation for another two years, but it was rejected citing rules. “However, the Centre has promised to clear all dues outstanding and it recently paid Rs 8,800 crore. The rest will also be paid; there is no doubt about that,” Bommai said. He also emphasised that the central government is paying state’s share of GST promptly.
“During the two pandemic years when GST collection was almost nil, the Centre had said compensation will be given only if there is collection. Yet, the Centre paid GST compensation to states,” Bommai pointed out. Elaborating further, he said GST was implemented from July 1, 2017 and all states were assured of compensation for loss of revenue arising out of implementation of the new tax regime as per the GST (Compensation to States) Act, 2017 for a period of five years. “If compensation is to be extended, the Act will have to be amended,” he said. On BBMP elections On the Supreme Court’s deadline to hold elections to local bodies, including to zilla and taluk panchayats and Bruhat Bengaluru Mahanagara Palike (BBMP), Bommai said the BBMP chief commissioner’s report on delimitation and reservation of wards will be submitted to the Supreme Court on July 22. He said based on directions from the SC, the process will be carried forward to facilitate conduct of polls as quickly as possible.
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