Uddhav Thackeray Writes To Nirmala Sitharaman Seeking Rs 15,558 Crore In Tax Dues

The Maharashtra government is awaiting "legitimate dues" of Rs 15,558.05 crore comprising Goods and Services Tax compensation till November 2019 from the Centre, Chief Minister Uddhav Thackeray has stated.

In his letter to Union Finance Minister Nirmala Sitharaman, the CM has sought immediate release of the amount. The copy of the letter was made available to media by his office on Wednesday.

"The pending dues include Rs 6,946.29 crore of tax devolution and Rs 8,611.76 crore towards GST compensation," it stated.

"As per the Union budget 2019-20, the tax devolution to Maharashtra was Rs 46,630.66 crore which is 11.15 percent more than Rs 41952.65 crore received by the state during 2018-19. But, the state has received only Rs 20254.92 crore till October 2019 which is 25.53 percent less compared to the budget estimate of 2019-20.

"Instead of receiving the enhanced amount, the state has received less than the budgeted amount. With further slowdown of the economy during the second quarter, it's likely that there will be further reduction in tax devolution," the letter said.

It also expressed fear of a shortfall in GST collections compared to the benchmark growth of 14 percent due to the slowdown in the economy. "During the current financial year, we have received Rs 5,635 crore as GST compensation for the first four months only. However, an amount of Rs 8,611.76 crore is due towards the GST compensation upto November 2019," he said.

The letter further stated that Integrated GST settlement was done during 2017-18 based on tax devolution formula of the Finance Commission, instead of the formula adopted for such settlement.

"As per the latest CAG report, for the year ended March 2018, the IGST settlement for many transactions is not happening," it stated.

"The state is awaiting legitimate dues of Rs 15,558.05 crore from the Centre. The state is also suffering due to the shortfall in tax devolution. Timely release of GST compensation and tax devolution amount will help my state to manage finances efficiently," the letter stated.

In a meeting with finance ministers of Punjab, Kerala, Delhi, Rajasthan, Chhattisgarh, and Madhya Pradesh last week, Sitharaman had assured that GST compensation due to them for August and September will be released soon. She, however, did not specify a timeline.

Thackeray heads a coalition government of the Shiv Sena, NCP and Congress, which came to power last month.

The BJP-led NDA government headed Maharashtra prior to the Oct. 21 assembly polls.