GST kitty at 19-month low

NEW DELHI: Goods and Services Tax (GST) collection in September fell 2.67% to ₹91,916 crore compared to the same month last year, driven by the ongoing consumption slowdown. September’s GST collections were the lowest since February 2018. The tax collection in August 2019 was ₹98,202 crore.

Experts cited the economic slowdown as the reason for falling GST collections. Deloitte India partner MS Mani said: “The lower collections seem to be on account of the lower GDP [gross domestic product] growth numbers that we have seen as GST is a transaction tax that is immediately impacted by any decline in economic activity.”

India’s annual GDP growth in the quarter ending June 2019 was 5%, the lowest in 25 quarters. It also marked the fifth consecutive

quarter of slowing growth in the Indian economy.

The fall in GST collections in September has been accompanied by a decline in various highfrequency economic indicators. The Nikkei India Purchasing Managers’ Index for manufacturing in the month of September was 51.4. Although it is above 50, which separates growth from contraction, the annual difference in this indicator was -1.5%.

India’s largest carmaker Maruti Suzuki reported a 27% annual decline in domestic car sales in September. Domestic car sales have been declining for 14 consecutive months according to data compiled by the Centre for Monitoring Indian Economy (CMIE) until August 2019.