Just on the lines of petroleum and fertiliser subsidies, payment of Goods and Services Tax (GST) compensation to states may become a major item of arrears for the Centre, starting this financial year. Despite releasing a massive Rs 1.20 lakh crore of GST compensation to states till February end FY20, a significant amount of GST compensation dues of states still remain unpaid which will now be rolled over to the next fiscal, sources privy to the developments told CNBC-TV18.
While February-March GST compensation is always paid in the next fiscal, this time around full instalment of December-January and part instalment of October-November will get rolled over as arrears. Although Rs 19,950 crore was paid as GST compensation by the Centre to the states for October-November, government officials indicate approximately Rs 13,000 crore may still be the residual amount unpaid for this period. December-January compensation instalment is likely to be estimated at another Rs 30,000 crore.
While for February-March, the GST compensation requirement may be on the lower side then what has been paid in the bi-monthly instalments so far, depending upon the pace of GST collections. All of this may add up to approximately Rs 50,000-60,000 crore worth of GST compensation dues to states, which the Centre may have to deal with in the next fiscal.
The GST cess receipts in FY20 RE has estimated at Rs 98,000 crore by March-end and fresh accruals of cess collected in February and March will become the opening balance for the GST Compensation Fund in FY21.