Government Collects Rs 91,916 Crore GST For August, Lowest In 19 Months
The goods and services tax collection for August fell to its lowest in 19 months amid slowing consumption in the economy.
GST paid for August—collected in September—stood at Rs 91,916 crore, according to a statement by the Ministry of Finance. That compares with Rs 98,202 crore in July and Rs 1.02 lakh crore collected in June. It’s about a 3 percent drop over the year-ago period.
This comes after India’s gross domestic product grew 5 percent in April-June 2019, the slowest pace in six years, as a sharper-than-expected fall in private consumption took its toll on the economy. Auto sales in August witnessed their biggest monthly decline in nearly two decades even as a consumption slowdown affected volumes of consumer goods makers.
MS Mani, partner at Deloitte India, attributed the fall in GST collections to slowing economic growth, as GST being a transaction tax is immediately impacted by decline in any economic activity. “However the subsequent festival season is expected to improve collections,” Mani said.
Agreed Abhishek Jain, partner at EY India. "With the recently announced fiscal and economic measures coupled with the upcoming festive season, the demand and related GST collections may witness an increase in the coming months," he said, adding that stricter controls on tax evasion and audits by the revenue authorities may also help in improving the collections.
However, tax compliance improved in August. The number of GST returns filed for August by Sept. 30 stood at 75.94 lakh against 75.80 lakh in July, and 75.79 lakh in June.
Break-up of GST collected under various heads:
- Central GST- Rs 16,630 crore
- State GST- Rs 22,598 crore
- Integrated GST- Rs 45,069 crore
- Compensation Cess- Rs 7,620 crore
Integrated GST is settled between the states and the central government, based on consumption in the respective state. From the IGST collected for August, Rs 21,131 crore was transferred as central GST and Rs 15,121 crore was settled as SGST. Total revenue earned by central and state governments after the settlement was Rs 37,761 crore and Rs 37,719 crore, respectively, the statement said.