High growth hits state GST refund

The state government’s high revenue growth is working against it while claiming compensation for the loss caused by the implementation of the Goods and Services Tax

The state has experienced a revenue loss of nearly `400 crore on account of GST so far.

As per GST norms, states with less than 14 per cent revenue growth rate are eligible for compensation. TS has been witnessing over 20 per cent growth rate.

Chief Minister K. Chandrasekhar Rao will take up the issue with the Centre since the government is facing financial crunch since GST launch.

Mr Rao is planning to visit New Delhi after Diwali and meet Prime Minister Narendra Modi and Union finance minister Arun Jaitely in this regard.

The CM held meetings with finance minister Etala Rajender and officials of the finance and commercial taxes department at Pragathi Bhavan twice last week and obtained reports over the impact of GST on state finances and to explore possibilities of seeking compensation from Centre to this effect.

In the GST Council meeting held last week, Mr Rajender took up the issue of TS suffering revenue loss after GST.

“Majority of the states are eligible for GST compensation as their revenue growth is less than 14 per cent. Only 4-5 states including Telangana state have growth rate above 14 per cent. Though we raised this issue, we could not get any clarity or assurance from Centre on claiming compensation. We could not exert pressure on Centre for compensation as majority of states, which are eligible for compensation remained quiet,” he said.

The minister met Mr twice after the meeting and explained him about how the state finances were strained after GST following which the CM said that he would visit Delhi soon and take up the issue with the Centre.