Entire GST compensation dues, worth Rs 16,982 crore, will be cleared: FM Sitharaman

Union Finance Minister Nirmala Sitharaman on Saturday said the entire pending dues for the GST compensation cess worth Rs 16,982 crore owed to states will be cleared as of today.

"We have announced today that the entire due on the pending balance of the GST compensation will be cleared as of today. In other words, the entire pending balance of the GST compensation - a total of Rs 16,982 crore - will be cleared," Sitharaman said at a press briefing following the 49th GST Council meet held earlier in the day at Vigyan Bhawan in the national capital.

In addition, the Finance Minister said the Centre would clear the admissible final compensation to those states, which have provided the revenue figures as certified by the audit accountant general of the states and that amounts to Rs 16,524 crore.

She clarified that the Centre releases 90 per cent of GST compensation owed to states even if the states are awaiting the authentication certificates. "Waiting for the certificate does not mean that we don't release anything at all. Nearly 90 per cent of the compensation is released. Only 5-8 per cent is retained subject to the AG certificate reaching us," she added.

"Although this amount is not really available in the compensation fund as of today, we have decided to release this amount from our own resources and the same amount will be recouped from the future compensation cess collection," said the Finance Minister.

While speaking on the reduction of GST rates, Sitharaman also said, "We are reducing the item on Raab - the kind of liquid jaggery - to between nil to 5 per cent." She said. "if it's loose it will be nil and if it's prepackaged and labelled, it will be 5 per cent."

She also pointed that the central government has received authentication certificates from six other states that will be entitled to Rs 16,524 crore. These are Delhi (Rs 2,400 crore), Karnataka (Rs 7,900 crore), Odisha (Rs 834 crore), Tamil Nadu (Rs 4,200 crore), Telangana (Rs 1,265 crore), and Puducherry (Rs 42 lakh). However, 15 states/UTs have not provided their authentication certificates.

Meanwhile, GST Council reduced the Goods and Service Tax on liquid jaggery, pencil sharpeners, and certain tracking devices, Union Finance Minister Nirmala Sitharaman said.

Briefing media after the 49th meeting of the GST Council, the minister also informed that reports of the GoM (Group of Ministers) on checking tax evasion by pan masala and gutkha industry, and on Goods and Services Tax Appellate Tribunals (GSTATs), have been taken on board.

She further said all the GST compensation dues will be cleared, including Rs 16,982 crore for the month of June.

The finance minister further said the GST Council has decided to rationalise late fees on filing of annual GST returns after the due date.

With inputs from agencies