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Budget 2024:
Sitharaman underlines Centre's support to states via timely tax devolution, GST compensation arrears

Jun 24, 2024

Union Budget: Finance Minister Nirmala Sitharaman emphasised the Centre's commitment to supporting states through timely tax devolution and GST compensation arrears to boost economic growth during a pre-budget meeting with state finance ministers. She encouraged states to utilize the 50-year interest-free loan scheme for reforms. States appreciated the assistance and provided suggestions for the upcoming Union Budget, with specific requests for projects and allocations.

Finance Minister Nirmala Sitharaman on Saturday underlined Centre's support to states through timely tax devolution and GST compensation arrears to stimulate growth. At the pre-budget meeting with state finance ministers, Sitharaman also nudged states to take advantage of the scheme under which the Centre gives 50-year interest free loan to states for undertaking specified reforms.

In her remarks, the Union Finance Minister underlined the union government's support to states through timely tax devolution, Finance Commission grants, and arrears of GST Compensation being provided for providing stimulus to growth, an official statement said.

Regarding the 'Scheme for Special Assistance to States for Capital Investment', Sitharaman mentioned that while most of the loans are untied, a part of it is conditional-linked to citizen-centric reforms by states and sector-specific capital projects and requested the states to avail these loans by fulfilling requisite criteria.

Most states appreciated the centre's 'Scheme for Special Assistance to States for Capital Investment' and gave some suggestions for further improvement.

The participants also gave several valuable suggestions to the Union Finance Minister for inclusion in the Union Budget for FY 2024-25, along with some State-specific requests, the statement added.

Rajasthan FM and Deputy CM Diya Kumari told reporters that the state has asked for a hike in allocation towards Eastern Rajasthan Canal Project (ERCP), Jal Jeevan Mission (JJM), certain national highways projects and railway lines.

Karnataka Finance Minister Krishna Byre Gowda sought releasing Rs 5,300 crore of already announced assistance for Upper Bhadra Water Project and declare it a national project.

He also sought inclusion of cesses and surcharges into a divisible pool so that states get their rightful share in central taxes.

Gowda also sought an increase in the central share to beneficiaries in housing schemes from Rs 1.5 lakh to Rs 5 lakh in urban areas and from Rs 1.2 lakh to Rs 3 lakh in rural areas.

[The Economic Times]

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