At Rs 1.31 trn, India’s Nov GST collection second-highest in a month yet
Goods and services tax (GST) collection grew about 25 per cent year-on-year to Rs 1.31 trillion in November, the second-highest mop-up ever, the official data showed on Wednesday, giving experts confidence that GST receipts would surpass the Budget projections for 2021-22. The highest collection was recorded in April this year, at Rs 1.40 trillion.
Even as e-way bills generated in October were at a record high of 73.5 million, the collection in November trailed the April figures. Transactions in a month yield GST collection in the following month. In March, 71.2 million e-way bills were generated. The finance ministry said the April figures were linked to year-end revenues. As such, there is a bump in April collections.
GST collection crossed the Rs 1.3-trillion mark for the second straight month in November. This is in line with the trend in economic recovery, the ministry said in a statement.
GST revenue last month was also 27 per cent higher than that in the corresponding pre-Covid month of 2019-20, and 1.1 per cent higher than the Rs 1.30 trillion collected in October this year.
“It (the November collection) was also higher than the last month’s collection, which also included the impact of returns required to be filed quarterly,” the ministry said.
The official data released on Tuesday showed that the economy grew 8.4 per cent during the second quarter of the current financial year. It also surpassed the growth level of the corresponding pre-Covid period of 2019-20 by 0.3 per cent. In the previous quarter, economic growth had declined 9.2 per cent compared to the pre-Covid period, even as it rose 20.1 per cent year-on-year.
E-way bills generated till November 21 were quite less at 39.4 million, which may adversely impact the December collection.
“Collections may dip in December 2021, as suggested by the deceleration in the daily average e-way bill generation in the first three weeks of November. Nevertheless, we expect CGST collection to rise to Rs 5.8 trillion in FY2022, exceeding the FY22 BE by Rs 50,000 crore,” ICRA Chief Economist Aditi Nayar said.
M S Mani, partner at Deloitte India, said GST collections had stabilised at a level that would help cross the GST revenue targets for FY22.
Of the total GST collection, Central GST stood at Rs 23,978 crore, state GST at Rs 31,127 crore, integrated GST at Rs 66,815 crore, and cess at Rs 9,606 crore. IGST included Rs 32,165 crore from import of goods, and cess included Rs 653 crore from inbound shipments.
During the month, revenues from import of goods were 43 per cent higher, while those from domestic transactions (including import of services) were 20 per cent higher compared to last year.
The government has settled Rs 27,273 crore to CGST and Rs 22,655 crore to SGST from IGST as regular settlement. The total revenue of the Centre and states after regular settlements in November stood at Rs 51,251 crore for CGST and Rs 53,782 crore for the SGST. The Centre also released Rs 17,000 crore to states and Union Territories towards GST compensation on November 3.
Among major industrial states, Karnataka saw a 31 per cent rise in GST collection in November year-on-year, followed by Gujarat at 26 per cent and Maharashtra at 24 per cent.
The ministry said the recent trend of high GST revenues was a result of various policy and administrative measures taken by the government in the past to improve compliance. “Central tax enforcement agencies, along with the state counterparts, have detected large tax evasion cases, mainly relating to fake invoices, with the help of various IT tools developed by GSTN that use the return, invoice and e-way bill data to find suspicious taxpayers,” it said.