NEW DELHI: Finance Minister Nirmala Sitharaman has assured the Parliament that the government is committed to paying GST compensation to states.

Responding to a slew of queries by MPs cutting across party lines during Question Hour in Lok Sabha, Finance Minster said: "Since its inception 5 years ago, (GST) compensation has been expected to be given, which we are committed to and have been doing continuously.If I were to go by month, the last month was June, when compensation had to be provided. Of the June amount, almost half has already been paid. Hence, for the other half, we are waiting for the adequate collection to take place as it has to be given from the compensation cess, which goes into a public account, from where it is given. "Half of the compensation that required to be paid was released in June," Finance Minister informed members, who sought to know as to by when the Centre will pay the pending GST compensation amount to states.

The queries were posed by Congress member Nakul Nath and BJD's Bhartruhari Mehtab.

"There was no more fund available for me to release the rest of the half. Otherwise, there is nothing pending for me to offer in the sense that all that has been collected has been distributed. But the GST compensation has already been extended till 2026 to pay for the loans that were taken, back-to-back to the states," Finance Minister said.

"The time was extended for a period of five years in order to pay for that payback, that is, for the loan taken and the interest thereon, to service it, but for the borrowed amount, it was extended until 2026 already," she said.

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