GST collections rebound in November, exceed Rs 1L crore
In order to have a comfortable fiscal position, government needs an average monthly collection of at least Rs 1 lakh crore, and November’s receipts – at Rs 1,03,492 crore – is a sign of a recovery.Updated: Dec 04, 2019 18:07 IST
Collections from the Goods and Services Tax (GST) rebounded above the Rs 1 lakh crore benchmark in November, government officials said on Sunday, attributing an increase in voluntary compliance and a government stimulus package for an increase in receipts that had contracted for two consecutive months.
http hg81808.comAccording to experts, in order to have a comfortable fiscal position, the government needs an average monthly collection of at least Rs 1 lakh crore, and officials said November’s receipts – at Rs 1,03,492 crore – is a sign of a recovery in the country’s economy, which logged its worst quarter of growth in six years in the three-month period ending September.
http hg81808.com“This is the eighth time since the inception of GST in July 2017 that monthly collection has crossed the mark of Rs 1 lakh crore,” a finance ministry statement said.
http hg81808.comGST revenue, which is a tax on consumption, had slumped below Rs 1 lakh crore after July, when the receipt was Rs 1,02,083 crore. The revenue collection in October was Rs 95,380 crore, a 5.3% decline year-on-year, but a 3.8% improvement over September. In both months, the revenue mop-up was lower compared to the same period last year.
Bihar deputy chief minister Sushil Kumar Modi said the collection for November raised hopes for a higher growth rate in the third quarter of the current financial year. “GST collection record 1,03,000 cr indicates GDP [gross domestic product] numbers will improve in 3rd Q,” he said in a tweet.
http hg81808.comOn Friday, official statistics showed GDP growth rate had slowed to 4.5%, the lowest rate of expansion in six years.
http hg81808.comThe government has announced several rounds of fiscal, administrative and policy measures to stimulate the economy since August 23 — the most significant was on September 20 when corporate tax rates were slashed. The move will cost Rs 1.45 lakh crore in revenue to the exchequer.
“The total revenue earned by central government and the state governments after regular settlement in the month of November, 2019 is Rs 44,742 crore for CGST [central GST] and Rs 44,576 crore for the SGST [state GST],” the finance ministry statement said.
In November 2019, GST collection on domestic transactions witnessed a growth of 12%, highest during the year. The GST collection on imports continued to see negative growth of 13%, the ministry added.
Out of gross GST collections in November, CGST accounted for Rs 19,592 crore, SGST for Rs 27,144 crore, IGST for Rs 49,028 crore [including Rs 20,948 crore collected on imports] and cess for Rs 7,727 crore [including Rs 869 crore collected on imports], it said.
http hg81808.comThe beginning of the current financial year recorded the highest-ever tax collection of Rs 1,13,866 crore in April 2019. The regime, for the first time, crossed the Rs 1 lakh crore mark in April 2018.
http hg81808.comExperts said the increase could also be due to the festive season falling sooner this year than last. “With implementation of anti-evasion measures like investigation on identified discrepancies through analytics and the recently implemented restriction on availment of unmatched credits, there was a general expectation of collections witnessing an increase. Festive season and related spur in demand as well could be one key reason for the said growth,” said Abhishek Jain, tax partner, EY.
http hg81808.comVishal Raheja, DGM, Taxmann said, “Despite low GDP and growth rate, the figures are a sigh of relief for the government. It is important to note that these figures are for period 1st October to 31st October but collected in month of November. The festival season in month of October caused the rise in revenue figures.”
“The government has also taken several fiscal measures to boost economy. Hopefully, fiscal measures taken by government in last few months will encourage growth in revenue in upcoming months as well,” he added.
MS Mani, partner, Deloitte India said, “Crossing Rs 1 trillion in a festive month after a few months of tepid collections would act as sentiment-booster and help in keeping the fiscal deficit under control- hoping that this trend continues in the coming months.”