Uttar Pradesh has estimated that the state will suffer a loss of Rs.13,500 crore in 2022-2023 due to implementation of the Goods and Services Tax. Presenting its estimated expenditure plans for the next five years to the 15th Finance Commission recently, the state said its revenue in subsequent years too will be hit because of GST.
The GST collection of UP is estimated to be ₹65,000 crore in 2022-2023, therefore the compensation will be around ₹18,000 crore. But the Union government will provide compensation only till June 2022, five years from the date of implementation of GST. Thus, in the last three quarters of 2022-2023, the loss of revenue is expected to be about Rs.13,500 and the revenue in the subsequent years may also be affected. Such losses in the post compensation regime need to be looked into by the finance commission.The state has asked for Rs.1,12,997.36 crore for 2020-2025 for activities such as construction of panchayat bhawans, cremation grounds, solar power setups and upgradation of rural local bodies. For urban local bodies, it has proposed a grant of Rs.2,80,520 crore for the period. The government has already transferred Rs.27,955 crore to state as compensation in June-July and Rs.17,789 crore for April-May.