Revenues from the goods and services tax (GST) surged to Rs 1.30 lakh crore in October, the second highest since its implementation four years ago, indicating recovery from the Covid-19 pandemic and the impact of festive demand, a finance ministry statement said on Monday.
The highest GST collection of Rs 1.41 lakh crore was recorded in April 2021. This is the fourth time in a row the collection was higher than Rs 1 lakh crore.
The collections were 24 per cent higher than October 2020 and up 36 per cent more than October 2019, which was before the pandemic.
Abhishek Jain, tax partner, EY India, said: “The robust GST collections are quite encouraging and a clear sign of economic recovery. With the ongoing festive season, we can expect similar or even higher GST collections in the coming months.”
Gross GST revenue collected in October 2021 was Rs 1,30,127 crore of which central GST was Rs 23,861 crore, state GST Rs 30,421 crore, integrated GST Rs 67,361 crore, including Rs 32,998 crore collected on the import of goods, and cess Rs 8,484 crore, including Rs 699 crore collected on the import of goods.
M.S. Mani, senior director, Deloitte India, said: “The impressive GST collections have resulted from a combination of sustained economic growth and continuing policy initiatives to improve compliance and discourage evasion… Going forward, we may see more checks and balances being introduced to encourage filers and dissuade non-filers.”
Aditi Nayar, chief economist, Icra, said: “With the October 2021 GST e-way bills expected to exceed the level seen in the previous month, the headline GST collections are slated to remain healthy in a range of Rs 1.25-1.35 lakh crore in November.
“Overall, we expect the Central GST collections to exceed the Centre’s budget estimate of Rs. 5.3 lakh crore by up to Rs 50,000 crore.”
She said the compensation cess collections have been hit by the semiconductor problem that has affected cars. However, with Rs 60,000 crore collected in the first seven months, the target for the fiscal was likely to be met.
“Higher GST collections and revenue buoyancy of other taxes will be more than enough to bridge the receipt shortfall, which could emerge from less than budgeted disinvestment proceeds,” Devendra Kumar Pant, chief economist, India Ratings and Research.
The finance ministry statement said the taxmen at the central and state levels have ensured greater compliance which have resulted in improved collections.
The GST Council has also voted for steps to ease compliance such a zero filing through SMS text.
The council has taken various steps to discourage non-compliant behaviour such as the blocking of e-way bills for the non-filing of returns, system-based suspension of registration of taxpayers who have failed to file six returns in a row and blocking of credit for return defaulters.