GST Collection Severely Affected Due To Covid-19: Highlights Of GST Council Meet

GST Council Meeting: Finance Minister Nirmala Sitharaman chaired the meeting of the GST Council through video conferencing today. In its 41st meeting, the GST Council discussed the matter of payment of GST compensation to states. Besides Minister of State for Finance Anurag Thakur said today's GST Council meeting was attended by finance ministers of states and Union territories, and senior officers from the central and state governments. The 41st meeting of the GST Council comes at a time when many states have complained of not receiving or not receiving sufficient funds on time as GST compensation. Under the GST law, states have been guaranteed payment for loss of revenue in the first five years since the new indirect tax regime came into force in July 2017.

Here are highlights of 41st GST Council meeting chaired by Finance Minister Nirmala Sitharaman:

• Compensation gap estimated at 2.35 lakh crorem says Revenue Secretary
• GST collection was severely affected in April and May due to Covid-19
• Two options for compensation were discussed with states
• No discussion was done on rate increases or decreases, says Finance Minister
• 'Act of God' may result in contraction of economy this fiscal: Finance Minister Nirmala Sitharaman, referring to coronavirus pandemic
• States have asked us to give them seven working days to think about the options. These options would be available only during the current year, the situation would be reviewed next year. We may have another GST meet soon: Finance Minister Nirmala Sithaaraman
• Annual GST compensation requirement is estimated to be around Rs 3 lakh crore, says Reveneu Secretary
• Cess collection expected to be around Rs 65,000 crore, says Reveneu Secretary
• During April-July 2020, total GST compensation to be paid is Rs 1.5 lakh crores, this is so because there was hardly any GST Collection in April and May, says Revenue Secretary