The government declared on Tuesday that it has collected ₹ 1,04,963 crore as goods and services tax (GST) revenue in November, which includes Central GST (CGST) of ₹19,189 crore, State GST (SGST) of ₹25,540 crore and Integrated GST (IGST) of ₹51,992 crore.
Goods and services tax (GST) collections in October stood at over ₹ 1.05 lakh crore, which crossed the ₹ 1 lakh crore mark first time since February this year. The government cites this as a ‘clear’ sign of recovery in the economy after its 23.9% contraction in the first quarter of this year. However, economists and businesses are cautious about the sustainability of this trend.
During the month of November, revenues from import of goods were 4.9% higher and the revenues from the domestic transaction (including import of services) are 0.5% higher than the revenues from these sources during the same month last year, said the Government of India in the press release.
Tax experts say that the expected shortfall in GST compensation for States could be lower than the current estimate of ₹2.35 lakh crore, if this revenue momentum is maintained through the rest of 2020-21.
The Ministry said, “The growth in GST revenue as compared to that in months of July, August and September 2020, of -14%, -8% and 5%, respectively, clearly shows the trajectory of recovery of the economy and, correspondingly, of the revenues.”
Aditi Nayar, principal economist at rating agency ICRA said this was in line with the expectation of a build-up of inventories in anticipation of a robust festive season. However, she added, “We remain as yet unconvinced on the persistence of this trend after the festive season is over after the pent-up demand is fulfilled.”
Among the States, Andhra Pradesh and Chhattisgarh recorded the highest 26% growth in GST collections in October year-on-year, followed by Jharkhand (23%) and Rajasthan (22%). Odisha clocked 21% growth as did the Union Territories of Jammu and Kashmir. The trend in the more industrially developed States was mixed, with 15% growth in Gujarat, 13% in Tamil Nadu and just 5% in Maharashtra.
The GST collections fell from the ₹ 1 lakh crore mark as the lockdown imposed to contain the COVID-19 spread.