Sensed severe trust deficit at GST Council meet, says Manpreet Badal

Aditi Tandon

Tribune News Service

New Delhi, Aug 27

Punjab Finance Minister Manpreet Badal on Thursday said the members from Opposition-ruled states who attended the GST Council meeting to discuss non-payment or GST compensation to states sensed severe trust deficit and felt the Centre was thrusting its solution on them.

Finance Minister Nirmala Sitharaman today proposed that states could borrow with the Centre facilitating the process and the repayment of borrowing can be done post 2022 from cess collections.

Read also: States seek a week to evaluate Centre's GST compensation options

“The meeting didn’t progress in a very cordial atmosphere I am afraid. There was a clear trust deficit. A solution is being thrust on us. That was the feeling we got. They are saying states can borrow and are not even mentioning their own constitutional commitment to pay GST compensation to states,” Badal said after the meeting where the finance ministers of opposition ruled states asked for a week’s time to discuss the proposal by made by Sitharaman.

Congress representatives at the meeting said they are not happy at the outcome, with Chhattisgarh minister TS Singh Deo terming the decisions at the meeting majoritarian.

Manpreet said the Centre should not thrust the proposal on states and appealed for the dispute resolution mechanism under Article 279 of the Constitution to be activated.

“This mechanism must be activated so that we have legal recourse in the matter. We understand the Centre has no funds to pay GST compensation to states but the trouble is the Centre doesn’t seem to have a commitment to what it has to do under law. We are a sovereign state and not a banana republic,” Punjab FM said.

The GST Council meet was called to discuss the single agenda of pending GST compensation to states for April to July 2020, with states facing severe resource crunch in COVID times.

The Congress which was until yesterday threatening severe action should the Centre not pay the compensation as mandated under GST regime today appeared reconciled to the turn of events. “What option do we have? We need resources to save our people,” Puducherry CM V Narayanasamy said.

He, however, said the GST regime needed a review to be made equitable.

“Producing states are at a severe disadvantage today,” Narayanasamy said.