GST revenue jumps to month’s highest

NEW DELHI: The Goods and Services Tax (GST) collection crossed Rs 1.12 lakh crore in August, a 29.6% year-on-year jump and highest ever for the month since its launch five years ago, signalling robust recovery of business activities after the second wave of the Covid-19 pandemic.

“Even as compared to the August revenues in 2019-20 [a non-covid year] of ₹98,202 crore, this is a growth of 14%,” a finance ministry statement said.

Gross GST revenue had never touched the ₹1 lakh crore mark in the month of August since its inception on July 1, 2017. According to official data, the GST collection in August 2017 was ₹95,633 crore, ₹93,960 crore in August 2018, ₹98,202 crore in August 2019, and ₹86,449 crore in August 2020.

The indirect tax collections, a weathervane of economic health, jumped over ₹1 lakh crore in two consecutive months after it plunged below the benchmark in June (₹92,849 crore) because of the second wave that hit India in April and

May this year. The June collection figure indicates the volume of business transactions took place in May. In May 2021, most of the states were under complete or partial lockdown due to the second wave.

MS Mani, senior director at consultancy firm Deloitte India said the collection in August this year is robust compared to same period in previous years, and this uptrend is likely to continue. “The high collection in August, relating to actual business transactions in July 21, indicates the revival of economic activities across states at the beginning of the festival season and is expected to be sustained over the coming months,” he said.

According to official data, GST collections in August, reflecting actual volume of business in July, all states and Union territories (UTS), barring Daman and Diu, posted positive revenue growth. Over 30% yearon-year revenue growth is reported from key manufacturing states such as Maharashtra (31% at ₹15,175 crore), Karnataka (35% at ₹7,429 crore) and Tamil Nadu (35% at ₹7,060 crore).

Out of the total ₹112,020 crore gross GST revenue in August 2021, the central GST (CGST) component is ₹20,522 crore, state GST (SGST) is ₹26,605 crore, and integrated GST (IGST) is ₹56,247 crore that includes ₹26,884 crore collected on import of goods. The cess collection in the month is ₹8,646 crore, including ₹646 crore on import of goods, the official statement said. While IGST is levied on inter-state transfer of goods and services and shared between the centre and the state, cess is levies on luxury items and sin goods such as liquor, cigarettes, aerated water and automobiles to compensate states for any shortfall