FMs of non-BJP ruled States to take legal recourse on GST compensation delay
Finance Minister T.M. Thomas Isaac is taking the lead to form a platform of Finance Ministers of non-BJP ruled States to seek legal recourse for wresting their due from the Centre.
This movement is set to emerge as a pressure group of Opposition parties against the Central government. The decision to collectively move court comes in the wake of the Centre delaying three months’ Goods and Services Tax (GST) compensation to the tune of ₹1,600 crore to the State.
Other States that are facing a similar crisis, mostly those ruled by the Congress, the Trinamool Congress government in West Bengal and the AAP government in Delhi, have evinced interest to join hands with Kerala. Dr. Isaac would hold a videoconference with these Ministers on September 30 as a first step.
The delay in transferring the funds, which has been mandated by the law, has seriously impacted the functioning of the government and pushed the State to the brink of a grave financial crisis.
Fall in cess collection was cited as the reason for deferring the payment, but the State government has refused to buy the argument. Dr. Isaac told The Hindu that he got legal opinion to move court and the prime task was to bring like-minded parties to join issue.
While seeking a legal recourse on the GST compensation issue, the group would also mount pressure on the Centre to enhance the annual borrowing limits to address the woes of recession.
Kerala had been in the forefront and had been consistently seeking to raise the limits from the present 3% to at least 3.5% or ideally 4% of the State Domestic Product (SDP) and also for keeping externally aided projects outside the limits. The shortfall in the State’s own tax revenue, the flood that battered the State two years successively and the ripple effect of the economic slowdown have all compounded the financial woes of the State.
Dr. Isaac said the Centre had not been lenient to the demands of the State and was constrained to explore legal options to wrest the State’s due.
The issue has come in handy for Left parties and the Congress to raise a point that the Centre is discriminating against non-BJP- ruled States and is expected to gain steam in the coming days.
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