After acting like a loan disbursement company while announcing its mega relief scheme to give relief during the COVID period, union government once again assumed this role and suggested the borrowing route to states which were demanding GST compensation. Adding salt to the wounds of the states battling COVID ,the centre has given the states two borrowing options instead of paying the GST compensation upright. The GST regime had transformed the country into a single common market in July 2017 and the states had agreed to subsume all their levies under a single tax. While for a common man the financial jargons are difficult to understand, we must know that Rajasthan’s outstanding amount of GST compensation is Rs 6990 crore which it is demanding from the centre, but there was no response on its repeated requests so far. What the state government will do now after the meeting of GST council is yet not known. Along with other states Rajasthan is facing and fighting this unprecedented health crisis of Corona pandemic and requirements of funds is paramount. It is said that finance is the blood of any organization then its vital importance for the government is obviously well known. The revenue of not only the Centre but the states has also shrinked owing to the pandemic but states have less space to earn revenue. Before the GST act, states could levy their own taxes like VAT which was a good source of revenue. After GST, all these taxes were subsumed and it was promised that states will be given GST compensation. But now the union government has gone to extent of blaming God for pandemic saying there will be contraction in economy. In what is being termed as an assault on the federal structure, the decision of the union government has not gone down well across the country if one goes by the responses given by various leaders on social media.
