The Centre has offered two borrowing options to states for the shortfall in GST Compensation which includes a special window to directly raise finances from the Reserve Bank of India (RBI). These proposals shall be discussed in detail in next GST Council meeting. It is however not yet clear that whether both these options shall be available or not. The states can either borrow he full compensation deficit of Rs 2.35 lakh crore, which includes revenue loss due to transition to GST and also the Covid-led slowdown, from the markets, facilitated by the Centre and the RBI, or the shortfall that’s purely due to GST implementation of Rs 97,000 crore via the RBI special window.
GST Council meeting: Centre places two borrowing options for states to meet GST revenue shortfall
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