Fact Check: Govt’s festival advance does not have 18 per cent GST, the viral message is misleading
The viral message is misleading. It is true that government has announced a festival advance of Rs 10,000 for its employees, which can be spent only through Rupay card and is recovered in installments. But the claim about 18 per cent GST deduction from the festival advance to Rs 8,200 is fake.
- By: Abbinaya Kuzhanthaivel
- Published: Oct 21, 2020 at 06:04 PM
New Delhi (Vishvas News). A viral message on Whats App about the announcement of Rs 10,000 as Festival Advance for Government employees is shared with a claim that it comes with an 18 per cent GST (Goods and Services Tax). The message alleges that the amount after GST deduction is Rs 8,200 and is recovered in 10 months installment.
Vishvas News investigation revealed the viral claim is misleading. While it is true that Finance Minister announced Rs 10,000 festival advance for government employees, the claim that it comes with 18 per cent GST is false.
Claim
A message on Whats App reads, “Finance Minister Nirmala Sitharaman announced festival advance of Rs 10,000 for central government employees. It comes with 18 per cent GST. The amount after deduction is Rs 8,200 and can’t be availed as cash directly. Employees will be provided with a Rupay card once after registering. Employees can get the amount only as products through the prepaid card. The money is recovered in ten months installment as Rs 1,000 per month…”
Investigation
We first searched on the Internet for the news about festival advance using keywords (Festival advance, Rs 10,000 for government employees).
An article in the Dainik Jagran published on 13 October states, “Finance Minister Nirmala Sitharaman announced 10,000 rupees as festival advance to all central employees to increase consumption in the economy. This advance will be given as RuPay card to the central employees and they will be able to make purchases with this card by 31 March next year. Employees will be able to return this advance in 10 installments, completely free of interest.”
We also found the office memorandum on the Finance Ministry’s official website.
“The government expects to disburse Rs 4,000 crore under this advance scheme. If given by state governments, another Rs 8,000 crore is likely to be disbursed. Assuming 50% adoption by states the estimate is Rs 4,000 crore,” stated the Live Mint article.
Vishvas News contacted Dr KS Ravichandran, Managing partner of KSR&Co to verify the claim. “Festival advance does not attract GST liability. If goods are purchased, GST will apply depending upon what is being purchased. From the design of scheme, it is clear that government wants people to spend,” he said.
Conclusion: The viral message is misleading. It is true that government has announced a festival advance of Rs 10,000 for its employees, which can be spent only through Rupay card and is recovered in installments. But the claim about 18 per cent GST deduction from the festival advance to Rs 8,200 is fake.
- Claim Review : Finance Minister Nirmala Sitharaman announced festival advance of Rs 10,000 for central government employees. It comes with 18 per cent GST. The amount after deduction is Rs 8,200 and can’t be availed as cash directly. Employees will be provided with a Rupay card once after registering. Employees can get the amount only as products through the prepaid card. The money is recovered in ten months installment as Rs 1,000 per month
- Claimed By : Whats App Message
- Fact Check : Misleading
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