The central government borrowed money and paid Rs. 2000 crore paid to the states

(PTI) New delhi date. 13

The central government has provided Rs 5,000 crore to the states to offset the losses caused by the implementation of GST. The central government has borrowed money and paid it to the states.

The finance ministry said in a statement that it had decided to borrow Rs 1.5 crore in the current financial year. Out of which Rs 5,000 crore has been borrowed and paid to the states as compensation.

This amount is different from the compensation paid to the states every two months. A statement issued here today said that the finance ministry had paid Rs 5,000 crore to the states and union territories as GST compensation.

Finance Minister Nirmala Sitaram said in a tweet that. The government estimates that states will have to borrow Rs 1.5 lakh crore this year to pay GST compensation. The implementation of GST in the current financial year is estimated to cost the states Rs 2.5 lakh crore. Out of which Rs 1.5 lakh crore will be borrowed. While one lakh crore rupees will be collected through cess on luxury items.

According to the Finance Ministry, a meeting of the GST Council on May 9 decided that the Center would borrow Rs 1.5 lakh crore to compensate the states for GST.

Last year too, the central government had borrowed Rs 1.10 lakh crore to pay GST compensation to the states.