The monthly Goods and Service Tax (GST) revenues have exceeded the mark of Rs. 1.4 lakh crore for the 20th straight month in a row as GST revenues were recorded at Rs 1.72 lakh crore in October 2023, the Finance Ministry said. The gross GST revenue collected in the month of October 2023 was Rs 1,72,003 crore of which Central Goods and Service Tax (CGST) was Rs 30,062 crore, State Goods and Service Tax (SGST) was Rs 38,171 crore, Integrated Goods and Service Tax (IGST) was Rs 91,315 crore. (Including Rs 42,127 crore collected on import of goods) and cess is Rs 12,456 crore (including Rs 1,294 crore collected on import of goods).
The revenues for the month of October 2023 are 13 percent higher than the GST revenues in the same month last year. During the month, revenue from import of goods was also 13 percent higher and the revenues from domestic transactions (including import of services) during the same month last year. The average gross monthly GST collection in the FY 2023-24 now stands at Rs. 1.66 lakh crore and is 11 percent per cent more than that in the same period in the previous financial year.
It is for the seventh time, the gross GST collection has crossed Rs 1.60 lakh crore mark. The average monthly gross GST collection for the first quarter of the FY 2021-22, FY 22-23 & FY 23-24 are Rs 1.10 lakh crore, Rs 1.51 lakh crore and Rs 1.69 lakh crore respectively.
The introduction and implementation of Goods and Service Tax marked was a turning point in India’s history of taxation. In a diverse and federal nation like India, where many tax laws were unified into a single system, the adoption of this complete system was especially noteworthy.
The GST is a value-added tax applied on the majority of goods and services sold for domestic consumption. Consumers pay the GST, but businesses that provide products and services remit it to the government. GST is levied on the 'supply' of goods or services, as opposed to the prior concept of levy on the manufacture of things, the sale of goods, or the provision of services. The rates of CGST, SGST, and IGST are mutually agreed upon by the Centre and the States. The rates are announced based on the GST Council's suggestion. In May 2015, the GST (122nd Constitutional Amendment) Bill, 2014 was enacted. It was enacted as the Constitution (101st Amendment) Act, 2016, and went into force on September 16, 2016. The GST was implemented on July 1, 2017.
Source: Ministry of Finance
The GST revenue collection was lowest in June 2021 at Rs. 92,800 crore and the highest was recorded in the month of April in 2023 at Rs. 1,87,035 crore. The GST collection had decreased by around Rs. 27,000 crore in May 2022 as the GST revenue collection stood at Rs. 1,40,885 crore. It witnessed a gradual recovery in the months of June and July 2022 but again decreased by around Rs. 5000 crore to Rs. 1,43,612 crore in August 2022.
The chart also shows better trends of GST collection in the current financial year as compared to FY2022-23. The GST collection in April 2023 was Rs 1,87,035 crore as compared to Rs 1,67,540 crore in April 2022. A similar trend was witnessed during the months of May and June. In October 2023, the GST collection was Rs 1,72,003 crore as compared to Rs 1,51,718 crore in October 2022.
The number of taxpayers has dramatically increased, rising from Rs 63.9 lakh in 2017 to over Rs 1.40 crore at the moment. GST revenues have significantly increased despite the modification to the threshold turnover limitations. The monthly average was Rs 89,885 crore in the first year, but it has since stabilised at a healthy 'new normal' of Rs 1.50 lakh crore in the most recent fiscal year, peaking at Rs 1.87 lakh crore in April 2023.
In a written reply to a question in Lok Sabha on July 31, 2023, Minister of State for Finance, Pankaj Chaudhary mentioned that the monthly average gross GST collection for the FYs 2021-22 & 2022-23 have shown 30 percent and 22 percent year on year growth respectively. The Minister added that GST is paid on a self-assessment basis and that tax administration at the federal and state levels is authorised to take enforcement action in cases of underpayment and nonpayment of GST. The detection of such instances and the recovery of unpaid or underpaid taxes are ongoing processes. He further mentioned that the government, on the recommendations of the GST Council, has been bringing several reforms in GST. These measures would improve the GST compliance and increase the GST collection.
MS Mani, Partner, Deloitte India, said, “The remarkable growth in GST collections over the past few months is not only on account of the underlying strong economic factors, but also due to the efforts of the tax authorities in deploying tools to compare data sets to determine short payment and evasion. The growing emphasis on audits led by specific information available on various databases, not only on the GST portal, has led to a significant increase in compliance across sectors and states. This is also reflected in the upsurge in the GST collections across key manufacturing and consuming states.”
Abhishek Jain, indirect tax head & partner at KPMG, said, “This significantly increased collection could be linked to settlement of disputes for FY 17-18 as the normal period of limitation was ending on 30th September. A mid-year collection of such an increased number is definitely worth a cheer and the ongoing festivities driven consumption could help this continue.”