The Opposition-ruled states have asked the Centre to convene a meeting of the Goods and Services Tax (GST) Council to discuss borrowing the entire GST shortfall of ₹1.7 lakh crore and not just ₹ 1.1 lakh crore as offered by the Centre.
Opposition-ruled states of Kerala, West Bengal, Chhattisgarh, Punjab and Jharkhand have fired a fresh salvo on the GST shortfall saying the Centre must borrow the entire amount of ₹1.7 lakh crore.
The West Bengal, Jharkhand, Kerala and Chhattisgarh governments have written to finance minister Nirmala Sitharaman welcoming the Centre’s offer to borrow money instead of asking the states and sought a GST Council meeting. In a letter to Sitharaman, West Bengal finance minister Amit Mitra has written, “You agreed in principle with the view expressed by many of us, in the GST Council meeting that the Central government should borrow from the special window with RBI. However, in practice, your new proposal offered to borrow two-thirds of the projected shortfall, leaving one-third for states to borrow, if required, from the market.”
West Bengal has pointed out that the interest payment by the Centre would be “significantly lower than RBI auction rate for the states to borrow from the market competitively”. Mitra has urged the Centre to borrow the remaining ₹72,000 crore.