As the 56th GST Council Meeting concluded in Delhi on Wednesday, Jharkhand Finance Minister Radhakrishna Kishore said that the proposed GST reforms could incur an annual revenue loss of Rs 2,000 crore to the state. Kishore urged the central government to compensate for the estimated loss.
As per a statement, he said, "The proposed GST reforms are estimated to cause a revenue loss of approximately Rs 2,000 crore in Jharkhand's automobile, cement, and other manufacturing sectors."
Kishore stated that Jharkhand is a manufacturing state, and claimed that the Goods and Services Tax (GST) system has adversely affected the state's internal revenue collection.
"Jharkhand's per capita income is Rs 1.05 lakh per year. Due to the weak purchasing power of the people, Jharkhand does not fall into the category of a consumer state. Due to this, Jharkhand has suffered a loss from the implementation of GST," Kishore said.
From 2017 to 2024-25, an estimated revenue loss of about Rs 16,408 crore has occurred, and by 2029, the loss is expected to be approximately Rs 61,670 crore, he said.
Kishore stated that around 75 to 80 per cent of coal and steel production from Jharkhand is consumed outside the state. Thus, the benefits of GST are accruing to consumer states.
"Jharkhand's well-considered recommendation is that to rationalise rates, there should be a robust revenue protection framework, a supplementary duty on sin and luxury goods, and a guaranteed compensation mechanism," Kishore said.
He further added, "Only such a balanced approach will protect the fiscal autonomy of states while advancing the objectives of GST reforms in the true spirit of cooperative federalism." Jharkhand should be provided with a guaranteed minimum of Rs 2,000 crore annually until the state's revenue becomes robust, Kishore urged the Centre.
(With Agency Inputs)
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