New Delhi (NVI): The Ministry of Finance informed that all States except Jharkhand and 3 Union Territories (UTs), have communicated their acceptance of Option-1 to meet the revenue shortfall arising out of GST implementation.
“Chhattisgarh at latest communicated its acceptance of Option-1 to meet the revenue shortfall arising out of goods and services tax (GST) implementation,” the Ministry of Finance said in a statement.
It added that the states and union territories who choose Option-1 are getting the amount of shortfall arising out of GST implementation through a special borrowing window put in place by the government.
Since October 23, the special window has been operationalised and the government has already borrowed an amount of Rs 30,000 crore on behalf of the States in five instalments and passed it on to the States and Union Territories.
The funds borrowed through the special window were released to the States and UTs on October 23, November 2, November 9, November, 23 and December 1, 2020.
“Now the state of Chhattisgarh will also receive funds raised through this window starting from the next round of borrowing,” the ministry noted.
Under the terms of Option-1, besides getting the facility of a special window for borrowings of Rs 1.1 lakh crore to meet the shortfall, the States are also entitled to get unconditional permission to borrow the final instalment of 0.50 per cent of Gross State Domestic Product (GSDP) out of the 2 per cent additional borrowings permitted by the government, under AtmaNirbhar Bharat Abhiyaan.
The government has further granted additional borrowing permission of Rs.1,792 crore to the state government of Chhattisgarh, on receipt of the choice of Option-1, (0.50 per cent of Chhattisgarh’s GSDP).
So far, the amount of additional borrowing permission granted to 27 states and the amount of funds raised through special window, and released to the States and Union Territories is annexed.
Apart from this, the Option 2 has also offered the States to borrow the entire compensation shortfall of Rs 2.35 lakh crore, including the COVID-impact portion through the issue of market debt.
-RJV
