Covid-19 crisis: States divided on alternative GST compensation mechanism

States might not arrive at a consensus on an alternative mechanism to compensate them for the shortfall in goods and services tax (GST) collection at the council meeting, expected to be held in a couple of weeks, as divergent views have emerged on the issue.

While Punjab and Kerala will press the GST Council to borrow in order to compensate states, Bihar Deputy Chief Minister Sushil Kumar Modi called the idea “wishful thinking”, arguing that states will need to “learn to live with the revenue shortfall”. West Bengal and Assam feel the council has no power to borrow. The compensation