GST reform: Punjab FM seeks robust compensation mechanism to ensure fiscal stability of states
GST
Dated:- 29-8-2025
PTI
New Delhi, Aug 29 (PTI) Punjab Finance Minister Harpal Singh Cheema on Friday said the Centre under the current proposal to rationalize Goods and Services Tax (GST) rates should provide adequate compensation to states to prevent financial instability, asserting that such a balanced approach will protect the fiscal autonomy of states while advancing the objectives of GST reform in the true spirit of cooperative federalism.
He emphasised that the benefits of this measure should reach the poor people of the country who are facing inflation, rather than corporate houses.
He stressed that if the current proposa
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central to this design, but after its implementation, states have to face significant revenue losses.
Cheema, according to a statement issued by the state government, said that after the implementation of this, Punjab has to bear a financial loss of around Rs 1.11 lakh crore. Though the state received Rs 60,000 crore when the compensation cess was active, till date no step has been taken on part of the central government to compensate the remaining loss amounting to Rs 50,000 crore to Punjab.
Interacting with the media, he said that all these states have strongly voiced for a mechanism of additional levy on sin and luxury goods to be imposed in order to maintain the current effective level of taxation. These proceeds must be fully trans
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