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GST collection hits record ₹2.10 trillion in April
- The GST collection breached the ₹2 trillion mark for the first time, reflecting robust economic growth and administrative efficiency in tax mop-up
New Delhi: Goods and services tax (GST) collection touched a record ₹2.10 trillion in April, reflecting robust economic growth.
This is also the first time GST collection has crossed the ₹2 trillion mark, since the unified indirect tax regime was rolled out seven years ago.
“This represents a significant 12.4% year-on-year growth, driven by a strong increase in domestic transactions, up 13.4%, and imports, up 8.3%,” a finance ministry statement said.
After accounting for refunds, the net GST revenue for April stood at ₹1.92 trillion, 15.5% higher than the same period last year.
Growth indicator
Coming after the second-highest monthly GST receipts of ₹1.78 trillion in March, the latest numbers were indicative of impressive economic growth as well as government’s efforts to improve compliance and tighten tax evasion, tax experts said.
Central Goods and Services Tax (CGST) collection was ₹43,846 crore in April, while state Goods and Services Tax (SGST) brought ₹53,538 crore. Integrated Goods and Services Tax (IGST) was ₹99,623 crore, including ₹37,826 crore collected on imported goods.
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Among the states, Maharashtra led with the highest collections, of ₹37,671 crore, recording 13% growth, while Karnataka was second with ₹15,978 crore collected in the month, showing 9% growth. Gujarat was third, with collections of ₹13,301 crore. Uttar Pradesh with ₹12,290 crore collections, up 19%, was higher than Tamil Nadu’s collections at ₹12,210 crore.
The robust GST collection shows the Indian economy is on a fast track to formalization, and businesses are rapidly becoming organized while coming into the mainstream, said Vivek Jalan, partner at Tax Connect Advisory Services LLP. “The economy is thus getting set for a big-bang final Budget in July 2024 and looking towards bringing alcohol, petrol, diesel and real estate under GST on the one hand, and implementation of the Direct Tax Code replacing the age-old Income Tax Act on the other, along with implementation of the Global Minimum Tax,” Jalan added.
Consistent growth
“The consistent growth in GST collections, with this one being the highest collection ever, is a big cheer and reflects upon the strong domestic economy, especially given the fact that growth on account of domestic transactions is 13.4% as compared to imports which is at 8.3%,” said Abhishek Jain, partner & national head, indirect tax, KPMG.
Jain also noted that another significant reason could be linked to deadline for GST audits and corresponding notices issued this year.
“With the next wave of GST reforms expected after the formation of the new government, the growth may be further accelerated,” said Partik Jain, partner, PwC India, said. “It may also enable the government to take bolder decisions such as rate rationalization or bringing products such as ATF and natural gas under the GST ambit.”
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The concerted efforts of the GST officials including zero tolerance for non-filers, coupled with rigorous measures to combat fake invoicing and the registrations has significantly bolstered GST collections in the state’s coffers, said Saurabh Agarwal, Tax Partner at EY.
Shravan Shetty, managing director at Primus Partners pointed to the formalization of the economy driven by increasing compliance, leading to rising collections. “We expect coming months to be close to the ₹1.7-2 trillion mark over the next few months, which should pick up as we enter the festive season post-rainy season. Key factors to consider include the current heat wave and its impact on manufacturing and services output. Also, the coming monsoon will impact the agricultural and rural economy which will determine GDP growth and GST collections in the second half of the year,” he added.
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Business NewsEconomyGST collection hits record ₹2.10 trillion in April
First Published:1 May 2024, 01:06 PM IST
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