West Bengal being deprived of due central funds, says state finance minister Amit Mitra

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Published: February 26, 2020 1:10:17 AM

West Bengal has estimated an SGDP growth of 10.4% during FY21.

Amit Mitra, gstAmit Mitra

West Bengal finance minister Amit Mitra said on Tuesday that the GST compensation fund is falling way short of the level required to fully bridge the state governments’ GST revenue shortfall. He also criticised the Centre for delays in release of funds to West Bengal under the centrally sponsored schemes.

Speaking to reporters on the sidelines of a CII event here, he said, “West Bengal was supposed to get GST compensation of Rs 2,406 crore for January. But we didn’t get that. We are afraid we may not get the GST compensations for February and March. Moreover, the Centre is depriving West Bengal of its due share of taxes (from the divisible pool).”

“ We have not yet received Rs 37,973 crore from the Centre on account of the centrally sponsored schemes,” he added.

“This fiscal, the Centre has reduced West Bengal’s share by Rs 11,000 crore in tax devolution. On the other hand, revenue from the Central cesses and surcharges (which are not required to be shared with states) have increased three fold in the last five years. This is against the spirit of federalism”, Mitra said further.

He said the Centre was in a denial mode, when it came to accepting the the reality of the state of the economy.

“There is not even a mention of the word slowdown in the entire Union Budget. The Centre should first accept the ground situation and then everyone can put their heads together to work out a solution,” Mitra said.
Citing the report of the director, financial intelligence unit, ministry of finance, he said there has been 14 times increase in suspicious transaction in the last five years.

West Bengal, Mitra said, has been able to reduce its fiscal deficit target to 2.18% of the GDP for FY21 from a level of 4.24% of the GDP in FY11. West Bengal’s debt for FY21 has been targeted at 32.9% of the GDP compared to 40.65% of he GDP during FY 11.

West Bengal has estimated an SGDP growth of 10.4% during FY21.

As reported by FE recently, the Centre will use about Rs 28,000 crore of the `47,271 crore absorbed by the Consolidated Fund of India in FY18-FY19 period as ‘surplus’ revenue from the GST compensation cess to reduce the state governments’ GST revenue shortfall in FY20. Even after this, the states’ GST revenue (SGST) in FY20 will be about `28,000 crore short of the level they would have achieved under the 14% ‘guaranteed’ annual growth formula.

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