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Cabinet officials

Punjab Finance Minister Demands Rs 60,000 Crore from Centre, Criticizes "Arbitrary" Rationalization of GST

Strategic Insights

— 1 min read

Punjab Finance Minister Harpal Singh Cheema has urged the Centre to pay the state government a total of Rs 60,000 crore, including GST compensation and other outstanding funds. He criticized the Centre's "arbitrary" rationalization of GST tax slabs as a "gamble" and accused the BJP-led government of playing "jumlebaazi" (fraud). Cheema argued that the state suffered substantial financial losses under the GST regime without receiving due compensation. He highlighted the financial impact on Punjab since the introduction of GST, stating that the state has suffered a loss of Rs 1,11,045 crore.

Key Takeaways:

  • Punjab Finance Minister Harpal Singh Cheema demands Rs 60,000 crore from the Centre, including Rs 50,000 crore for uncompensated GST losses.
  • The amount also includes Rs 8,000 crore in pending rural development fund (RDF) and an additional Rs 1,000 crore to be withdrawn from the Pradhan Mantri Gram Sadak Yojna.
  • Since the introduction of GST, Punjab has suffered a loss of Rs 1,11,045 crore.
  • The state's revenue projection was Rs 2,37,520 crore, but Rs 1,26,485 crore was promised as compensation under the GST regime.
  • Cheema accused the Centre of "gambling in the name of rationalisation" and randomly changing GST slabs, citing the example of tax on unmanufactured tobacco being slashed from 90-98% to 40%.
  • The minister questioned the Centre's handling of the compensation cess and the slashing of tax on "sin" goods, alleging that Punjab suffered financial losses due to the Centre's "wrong policies".
  • Cheema demanded that the state should be compensated on account of any losses due to rationalisation of GST rates, criticizing the Centre's move as a "jumlebaazi" of the BJP-led government.

Statistics:

  • Rs 1,11,045 crore: Financial loss suffered by Punjab since the introduction of GST.
  • Rs 2,37,520 crore: Punjab's revenue projection.
  • Rs 1,26,485 crore: Compensation promised under the GST regime.
  • Rs 50,000 crore: Uncompensated GST losses.
  • Rs 8,000 crore: Pending rural development fund (RDF).
  • Rs 1,000 crore: Additional amount to be withdrawn from the Pradhan Mantri Gram Sadak Yojna.
  • 27 exemptions: Number of exemptions given to various sectors and items under the GST regime.
  • 15 times: Number of times GST rates have been revised since the introduction of the regime.

Sources:

  • Punjab Finance Minister Harpal Singh Cheema, as quoted in The Times of India, Chandigarh edition.

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