Strong revenue performance a pleasant surprise: CEA
The compensation payable to the States for revenue loss arising due to GST is just Rs. 5,000 crore, far lower than was estimated, according to Chief Economic Adviser Arvind Subramanian.
In a candid interview to The Hindu , the outgoing CEA also batted for the lateral entry of talent into the government, saying that it was a “no brainer” in a situation where demand for talent outstripped the supply within the government.
However, Mr. Subramanian added that it wasn’t sufficient to get the talent from outside, but to ensure that the person can also effectively work with and within the bureaucracy.
“Consistent with my revenue neutral report and against what everyone said, the GST compensation requirements are only about Rs. 5,000 crore for the entire first year ,” Mr. Subramanian said. “We were surprised at how strong the revenue performance has been in the first year.”
He added that while it is difficult to ascertain its exact contribution, demonetisation “certainly did” contribute to the deceleration in the economy.