India’s goods and services tax (GST) collections rose 10.3 percent to athree-month high of Rs 1.82 lakh crore in July as compared to Rs 1.74 lakh crore in the previous month, according to data released on August 1.
The pace of growth of GST climbed back above double digits, after it fell below 10 percent for the first time post-pandemic in June.
"The surge in tax collections from Nagaland, Manipur, Andaman & Nicobar, and Ladakh suggests heightened economic activity and consumption in these developing regions of India. Further, a potential stagnant or decline in collections during August (compared to July month) is anticipated due to the monsoon season's impact on overall economic momentum," said Saurabh Agarwal, tax partner, EY India.
The numbers were higher than the previous month but lower than the GST mop-up in April, when collections had peaked at Rs 2.1 lakh crore. In the first four months of the year, gross collections are 10.2 percent up at Rs 7.39 lakh crore.
Domestic revenue grew 8.9 percent in July, but GSt revenue from imports was higher at 14.2 percent.
Refunds, on the other hand, were 19 percent lower than during a similar period in the previous year. Of the total refunds of Rs 16,283 crore, Rs 11,566 crore were for Integrated Goods and Services Tax.
Net domestic revenues at Rs 1.66 lakh crore were 14.4 percent higher than the previous July's figure of Rs 1.45 lakh crore.
The Budget 2024 released by the government on July 23 envisages GST revenues to expand 11 percent in FY25.
In a recent interview with Moneycontrol, Sanjay Kumar Agarwal, chairman, Central Board of Indirect Taxes & Customs (CBIC) had noted that even as tax buoyancy for GST is expected to decline, it shall remain above one.
“GST, after seven years, has fairly stabilised and that is reflected in the revenue that is coming from it,” Agarwal had noted.
The government is looking to rationalise the GST to bring down the number of rates to three.
In June, the government had reconstituted a rate rationalisation panel to submit a final report to the council suggesting changes in rates.
At present, four—5%,12%,18% and 28%—rates are levied, besides some essential commodities which are not taxed under the GST regime.
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