Experts see excessive allocation of I-GST to some states, call for remedy
As the Centre sets up an internal committee to assess the “negative balance” in the Integrated Goods and Services Tax (IGST)pppl, experts suggest it may largely be due to higher-than-required transfers to some states due to discrepancies in the settlement process.
“This often happens due to timing mismatches in the collection and distribution of taxes or excessive allocation to certain states,” said Sandeep Sehgal, partner-tax, AKM Global. “Such imbalances can arise from discrepancies in tax settlement systems (GSTN) or under-reporting of IGST liabilities,” he added.
On Monday, Finance Minister Nirmala Sitharaman had said in post-GST Council presser that the Centre-State body has decided to set up a committee under the chairmanship of the additional secretary of revenue with officers of both state and centre, to study the IGST mechanism and assess how excess transfers to some state can be recovered.
