Bhubaneswar: Odisha has received the entire Rs 30,231.14 crore in Goods and Services Tax (GST) compensation from the Centre for the five-year period between July 2017 and June 2022, Chief Minister Mohan Charan Majhi informed the state assembly on Monday.
In a written reply to a question by Baramba MLA Bijaya Kumar Dalabehera, the Chief Minister said the state government had been paid the full compensation due under the GST regime and that no further amount remains pending.
According to official figures placed before the House, the Centre had fixed Odisha’s Protected Revenue at Rs 98,239 crore for the compensation period of five years. Against this benchmark, the state collected Rs 68,008.66 crore in tax revenue during the same period, resulting in a shortfall of Rs 30,231.14 crore. This amount, payable as GST compensation, has already been released by the Centre.
The GST regime was rolled out across the country on July 1, 2017, following the enactment of the Constitution (101st Amendment) Act, 2016 and the Goods and Services Tax Act, 2017. To safeguard states against potential revenue losses arising from the new indirect tax system, the Centre had assured compensation for five years, from July 2017 to June 2022, under the Goods and Services Tax (Compensation to the States) Act, 2017.
For the purpose of calculating compensation, the financial year 2015–16 was treated as the base year, with the revenue collected in that year considered as the base revenue. A 14 per cent annual growth rate was applied to this base revenue to determine the projected Protected Revenue for each subsequent year. The compensation payable was calculated as the difference between the Protected Revenue and the actual revenue realised by the state. The funds were released in bi-monthly instalments.
With the payment of the entire Rs 30,231.14 crore, the state has received its full GST compensation entitlement for the five-year transition period, the Chief Minister told the Assembly, adding that no dues are outstanding from the Centre.
