Wednesday, 09 Oct, 2024
By: Yash Gupte
The revenues for the month of August 2023 are 11 percent higher than the GST revenues in the same month last year. Image Source: IANS
The GST is a value-added tax applied on the majority of goods and services sold for domestic consumption. 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.
The monthly Goods and Service Tax (GST) revenues have exceeded the mark of Rs. 1.4 lakh crore for the eighteenth straight month in a row as GST revenues were recorded at Rs 1.59 lakh crore in August 2023, the Finance Ministry said. The gross GST revenue collected in the month of August 2023 was Rs 1,59,069 crore of which Central Goods and Service Tax (CGST) was Rs 28,328 crore, State Goods and Service Tax (SGST) was Rs 35,794 crore, Integrated Goods and Service Tax (IGST) was Rs 83,251 crore. (Including Rs 43,550 crore collected on import of goods) and cess is Rs 11,695 crore (including Rs 1,016 crore collected on import of goods).
The revenues for the month of August 2023 are 11 percent higher than the GST revenues in the same month last year. During the month, revenue from import of goods was 3 percent higher and the revenues from domestic transactions (including import of services) are 14 percent higher than the revenues from these sources during the same month last year. The total gross collection for 2022-23 stands at Rs 18.10 lakh crore and the average gross monthly collection for the full year is Rs 1.51 lakh crore. FY 2022–2023 saw a 22 percent increase in gross GST revenues over the previous year. 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. Talking about the average monthly GST collection in the FY2020-21, FY2021-22 and FY2022-23 was Rs 94,734, Rs 1,23,608 and Rs 1,50,640 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.
Aditi Nayar, chief economist and head of Research and Outreach at rating agency ICRA Ltd. Said, “the headline GST number is marginally lower than the agency’s forecast, dampened by imports, which is a matter of commodity prices. The overall collection so far this year remains robust.”
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 2022 at Rs. 1,67,540 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 monthly GST collection crossed the mark of Rs 1.5 lakh crore in October 2022 and then in January 2023 when the GST collection was recorded at Rs 1,57,554 crore. The GST collection in March 2023 is second highest in FY 2022-23 and has crossed the mark of Rs 1.60 lakh for the second time since the inception of GST. The highest ever monthly GST collection was reported in April 2023 at Rs 1,87,035 crore.
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 June 2023, the GST collection was Rs 1,61,497 crore as compared to Rs 1,44,616 crore in June 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.
Saurabh Agarwal, Tax Partner at EY said, “The steady increase in revenue not only reflects a resurgence in consumer demand but also underscores the government's ongoing efforts to boost capital expenditure, which, in turn, is encouraging private investment. Nonetheless, it's worth noting that future growth prospects may be tempered by factors such as below par monsoon conditions, elevated inflation, and higher interest rates."
Major state economies Uttar Pradesh, Maharashtra, Gujarat, and Tamil Nadu all reported double-digit yearly growth rates in GST collections. According to official data, Maharashtra reported a strong 23 percent jump in GST revenue to Rs 23,282 crore in August. Gujarat experienced a rise of 12 percent to Rs 9,765 crore while Karnataka saw a rise of 16 percent to Rs 23,282 crore in GST collection in August.
Among the states, Tripura witnessed the highest growth (%) in GST collection in the month of August as its GST revenue stood at Rs 78 crore from Rs 56 crore in August 2022, marking a 40 percent increase. Tripura was followed by Arunachal Pradesh (39 percent), Nagaland (37 percent) and Goa (36 percent).
