New Delhi, Dec 18 (IANS): Minister T.S. Singh Deo, ahead of the 38th Goods and Services Tax Council meeting here on Wednesday, told reporters that the government should first plug loopholes in the GST regime and then consider rate hike, thereby hinting there may not be a rate hike on the council's agenda.

The Chhattisgarh Commercial Taxes Minister also stated that Chhattisgarh is not in favour of any rate hike either through compensation cess or GST rates.

The Minister also proposed to reduce the periodicity of the compensation pay out to one month from two months now. Besides the tranfer should be made on the 5th of the month.

Madhya Pradesh Commercial Tax Minister Brajendra Singn Rathore also said that he doesn't support a rate hike and suggested that the government should instead focus on compliance.

Besides, IANS also learned that a proposal to provide relief to vessels for offshore operations likely to be discussed in the Council meeting.

The government has set a Rs 1.10 lakh crore monthly GST collection target in the remaining months of the fiscal with Rs 1.25 lakh crore target set for one of these months.

In the past 8 months of the current fiscal, only in the month of April which is considered peak collection month the mop-up was a tad above Rs 1.10 lakh crore. In the four months, the collection was below Rs 1 lakh crore mark.

Tax experts hope the monthly collection to reach the new target provided economic growth improves.

M.S. Mani, Partner at global consultancy Deloitte, said that the target was quite achievable if economy grows at 6-7 per cent.

Decline in growth rate has impacted collection of both GST as well as compensation cess levied to make up for revenue loss to states on account of shift to the new regime. As a result of drop in collection, Centre has been finding it difficult to release compensation on time.

While it has paid the compensation for the months of August and September to states after much delay, the release of funds for October and November remains due.