Citing the huge revenue losses suffered by the state on account of the COVID-19 pandemic and the resultant lockdown, the Punjab Cabinet on Tuesday sought adequate compensation from the Centre to support the state in these difficult times.
During a review of the fiscal situation amid the pandemic, the Cabinet, under the chairmanship of Chief Minister Amarinder Singh, noted the situation was grave, considering the decline in revenue collection over the first quarter of 2020-21 and the estimated losses for the current fiscal.
A presentation made by the Finance Department showed that the state's own tax revenue collections for April-June had gone down by a whopping 51 per cent with GST losses alone being to the tune of 61 per cent as against the budgetary estimates for this period.
Goods and Service Tax (GST) and Value-Added Tax (VAT) revenue collections for this quarter together went down by 54 per cent. The decline in total revenue receipts for the April-June quarter was 21 per cent.
The Council of Ministers noted with concern that in terms of non-tax revenue collections of the state, the shortfall against budgetary estimates for Q1 of 2020-21 was a massive 68 per cent.
The situation was extremely grim, the Cabinet observed, calling for fiscal support from the Centre to compensate for these huge losses.
The revenue loss would badly impact not just the battle against Covid-19, which is now peaking in the state, but also obstruct the implementation of key schemes and programmes of the state in addition to affecting routine expenses, including payment of salaries, pointed out the Council of Ministers.
The government of India needed to come forward with urgent financial help for the state government to tide Punjab over the current crisis, felt the Cabinet.