GST Cess For providing compensation to the states
The GST rates and cess are prescribed on the basis of recommendations of the GST Council as made from time to time. GST Council, while making recommendation takes into account the request/representation of stakeholders.
GST collection in the current FY (2018-19) has been showing improvement compared to last FY (2017-18) except for the month of August, 2018. For providing compensation to the states on the account of loss of revenue, Compensation cess is being levied on certain luxury and demerit goods as per provisions in Section 8 of the GST (Compensation to States) Act, 2017. Any shortfall of revenue to States due to implementation of GST is being paid on bimonthly basis w.e.f. 01.07.2017.
The above information given by the Minister of State for Finance Minister Shri Shiv Pratap Shukla in the Parliament on 21.12.2018