GST compensation: States and Centre must not compete with each other, says Assam FM Sarma


Guwahati: Assam finance minister Himanta Biswa Sarma on Saturday said states and Centre must not compete with each other and this is not the spirit of the GST council. The borrowing options proposed by the Centre to make up for the shortfall in the goods and services tax (GST) compensation cess fund has been opposed by some states.

When asked about which borrowing option Assam may adopt, Sarma said, “We are now deliberating…what we want is authorisation to take loan. How much loan we want- that freedom must be with the state government. We don’t want Centre to borrow for us and offloaded to us.”

He added, “We want authorisation. Our compensation for the entire year will be Rs 6,000 crore. So this amount, if we borrow, will be refunded by the Centre. Why we should borrow for that money will anyways come to us. However, if my fiscal position allows, I will not borrow. If it does not, than we will borrow. This amount will be refunded by the GST council. They have given us seven days’ time, we are discussing among ourselves and we will take wise decision.”


The finance minister added, “We will not compete with the Centre that you should borrow, I will not borrow. We will go by what Union Finance minister Nirmala Sitharaman advised us. We do not want cat and mouse game with Centre. Centre is extending all kind of support in this critical hour. We must create situation where both go together. Competing between the Centre and state is not good thing and that was not the ideology of GST council.”

Sarma said, “Some of my estimated colleagues in the council are giving statements in extreme lines and that is not the spirit of the council. Despite not being duty bound. Centre has stated even if you (states) take loan, you are not going to return it but we (centre) are going to return it. Finance minister has taken the most sympathetic view and we must support it.”

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