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Tuesday, 4 August 2020

Revenue dips, Punjab Government holds up staff salary

Ruchika M Khanna

Tribune News Service

Chandigarh, August 3

Facing a financial crisis, the Punjab Government today "stopped" the salary of all employees, except those in the Class IV category.

Finance Department officials say the salary of all other employees will be released in a staggered manner, as and when they are able to arrange the funds. The monthly salary bill of the state government is Rs 2,303.26 crore.

Since pension (Rs 1,022 crore per month) and interest payments are kept in a separate head by the Reserve Bank of India, these two committed expenses of the state have reportedly been met. The Goods and Services Tax (GST) compensation, which hasn't been released by the Centre for the past four months (April to July), and the state's own tax and non-tax revenues falling drastically because of the lockdown, have left the government with no resources to meet the committed liabilities. Even the share of the state in Central taxes (Rs850 crore per month) has not been released by the Centre.

Just two days back, Finance Minister Manpreet Singh Badal had written to Union Finance Minister Nirmala Sitharaman, objecting to the submission of the Centre before a parliamentary panel that it was in no position to release GST compensation to the states. He said this would hit Punjab hard as GST was the largest component of its revenue. Over the past one month, the state has also cut down its expenses on mobile phone bills and fuel.

A senior Finance Department official said: "We are floating a state development loan of Rs 1,500 crore on Tuesday, which might help us borrow money from the market to meet our committed liabilities." He said in case the interest rate offered in the auction of the state development loans was high, they would raise Rs 1,000 crore from the sale of state bonds. This would be enough to meet all committed expenses, he added.


No help from centre

The Goods and Services Tax compensation, which hasn't been released by the Centre for the past four months (April to July), and the state's own tax and non-tax revenues falling drastically because of the lockdown, have left the government with no resources to meet the committed liabilities. Even the share of the state in Central taxes (Rs850 crore per month) has not been released by the Centre.



from The Tribune https://ift.tt/2PiXkO4

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