The State government has reiterated that the Centre should take loan and provide Goods and Service Tax (GST) compensation to the States.
Instead of increasing the cess or extending the cess collection for further period, Kerala is of the view that taking loans is the best option. But, the Centre should take loans instead of asking States and provide the pending compensation.
Addressing a press conference after the 41st GST Council meeting chaired by Union Finance Minister Nirmala Sitharaman on Thursday, Finance Minister T.M. Thomas Isaac said the proposals put forward would lead to financial loss for the State. The Centre was of the view that the State should be able to absorb the loss of income, Dr. Isaac said.
The State would give its reply within seven days to the proposals put forward by the Centre after holding consultations with Chief Minister Pinarayi Vijayan and other ministers, Dr. Isaac said.
Segregating the compensation as loss due to COVID-19 and loss due to GST was to avoid paying compensation, Dr. Isaac said.
The Centre was delaying the compensation for the last six months, he said. The State could be paid ₹2.5 lakh crore compensation as the Centre had provided ₹21 lakh crore for Atmanirbhar Bharat, the Finance Minister said.
