GST Collections at All-Time High of Over Rs 1.15 Lakh Crore in December

Gross revenue from the Goods and Services Tax (GST) hit a record in December 2020, with collections of ₹ 1,15,174 crore, 12% more than a year ago and 9.7% more than the monthly receipts previous.

December marks the fourth consecutive month that GST collections have grown year-over-year, after revenue collapsed in the first quarter of 2020-21 amid the COVID-19 lockdown.

The government said the highest monthly GST level since the introduction of the excise tax in 2017 was a reflection of a rapid economic recovery underway. It also attributed part of the gains to better compliance after an official crackdown on malpractice to eliminate taxpayers who evade the GST or use false invoices to defraud the treasury.

“During the month, income from importing goods was 27% higher and income from internal transactions (including import of services) is 8% higher than income from these sources during the same month last year”, the Revenue Department in the The Finance Ministry said in a statement on Friday.

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December’s 12% year-on-year growth was the highest rate in 21 months.

“This has been due to the combined effect of the rapid post-pandemic economic recovery and the national campaign against GST evaders and false invoices along with many recently introduced systemic changes, which have led to better compliance,” the statement said. .

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“This shows that the industry is getting back to normal,” said Chandrajit Banerjee, director general of the Confederation of Indian Industry (CII), pointing to the increase in revenue from importing goods as an indicator that the economy is in the ‘fast track to growth now after a long decline due to the COVID lockdown’,

Abhishek Jain, EY’s fiscal partner, also said that collections crossing 1.15 million lakh rupees for the first time despite the persistence of the pandemic, suggest a recovery in the economy, although administrative changes in the system also helped. .

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“Part of this could also be because the government plugged the GST revenue leakage due to false credits through fradulent billing and the introduction of electronic billing,” he said.

Among the states, Odisha posted 20% growth in GST revenue in December, followed by Rajasthan (16%), Andhra Pradesh (14%) and Gujarat (13%). Revenues increased 11% in Jharkhand, 10% in West Bengal and Chhatisgarh, and 8% in the states of Tamil Nadu, Kerala, Karnataka and Uttar Pradesh.

So far, the highest monthly GST collections were recorded in April 2019 at approximately ₹ 1.14 lakh crore. The Finance Ministry said that April revenues typically tend to be high, as they correspond to activity statements submitted in March, which marks the end of the financial year.