Finally the 1% ‘calamity cess’ is official and it will give power to Kerala to levy additional cess till 2 years for the rehabilitation activities being carried out in the state which was earlier hit by the massive floods.
Bihar Deputy Chief Minister Sushil Modi along with the GoM panel took this decision along with other ministers in the panel. Also, the panel suggested the GST council must support Kerala to borrow additional funds than the permitted levels.
In the official statement, it was said that “Kerala had asked the GST Council for levying cess to fund rehabilitation work. The GoM has recommended to the Council that Kerala is allowed to levy 1% cess for two years. Also, the Centre and states will together decide on increasing the borrowing limit under FRBM for funding natural calamity.”
As per the findings, Kerala may or may be able to gather that much of funds to reinstate the Kerala which was hit by the floods, as the destruction was widely disastrous having multifold damage to the properties.
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However, there are chances that the additional funds approved for the Kerela may prove beneficial for the state but the chances may arise of political hoarding of money within the system.
