₹1.12 L cr GST collections in Aug, highest for month
NEW DELHI: The Goods and Services Tax collection crossed ₹1.12 lakh crore in August, a 29.6% year-on-year jump and the highest ever for the month since its launch five years ago, signalling robust recovery of business activities after the second wave of Covid-19 pandemic.
“Even as compared to the August revenues in 2019-20 [a non-covid year] of Rs 98,202 crore, this is a growth of 14%,” a finance ministry statement said.
Gross GST revenue hasn’t 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, in 2018, ₹93,960 crore; in 2019, ₹98,202 crore; and in 2020, ₹86,449 crore.
GST collection in August this year, however, was 3.75% down from the July 2021 revenue of ₹1,16,393 crore.
Indirect tax collections, a weathervane of economic health, have now crossed the ₹1 lakh crore mark for two consecutive months after plunging below the benchmark in June (₹92,849 crore) because of the second wave that hit India.
“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,” said MS Mani, senior director at consultancy firm Deloitte India.
HOWEVER, GST COLLECTION IN AUGUST WAS 3.75% DOWN FROM THE JULY 2021 REVENUE OF ₹1,16,393 CRORE
NEW DELHI: Over 1.5 million people from both the formal and informal sectors lost their jobs in August, reversing some of the gains made in July, as the unemployment rate rose in rural and urban India.
According to the Centre for Monitoring Indian Economy (CMIE), the number of the employed fell from 399.38 million in July to 397.78 million in August, with nearly 1.3 million job losses in rural India alone.
According to CMIE, the national unemployment rate rose from 6.95% in July to 8.32% last month.
Urban unemployment rose 1.5 percentage points to 9.78% in August. It was at 8.3% in July, 10.07% in June, 14.73% in May and 9.78% in April. In March, just before the second wave of Covid infections hit India, the urban unemployment rate was at 7.27%.
Rural unemployment rose 1.3 percentage points to 7.64% in August against 6.34% in July, primarily driven by low sowing during the kharif season. While the employment rate fell, the labour force participation rate climbed marginally in August, indicating that a larger pool of people were willing to get into the job market. The monthly CMIE data showed 36 million people were actively looking for work, compared to around 30 million in July.
The total labour force size also rose to 433.86 million— almost four million more than July—reflecting a worsening trend. In fact, the labour force size in August was almost the same as in March 2020, just before the pandemic-induced nationwide lockdown, which led to muted economic activity, closure of firms and a shrinking employment market in April.
India has been witnessing a tough jobs environment for the last few years. Though economic activity is gradually returning to normal, the job market is struggling. Across India, at least eight states are still reporting doubledigit unemployment rates.
The rise in unemployment in August comes after July witnessed nearly 15 million people joining the labour force primarily in low-productive agriculture work when the monsoonled sowing season was at its peak. Job additions in July mostly comprised poor-quality informal jobs, and unless the economy recovers these people absorbed in agriculture work will find it tough to find alternatives, CMIE said last month.
“The labour market struggle will continue for a few more months at least. Unless the formal sectors show great promise, recovery of good quality jobs will take time. Economy is slowly recovering, at least the FY21 first quarter GDP data shows, but it’s on a low base. With the festive season, you will see some uptick in coming months, but a decent jobs recovery will depend on the economy, market demand and if we can manage to stop third wave of the pandemic,” K.R. Shyam Sundar, a labour economist, said.