Takeaway on GST Day: June collection inches up to ~956 bn
On the first anniversary of the goods and services tax (GST), the government machinery was out in full force to spread cheer about the biggest indirect tax reform in the country. While top representatives of the finance ministry addressed a large gathering at a jam-packed auditorium in the Capital’s Ambedkar International Centre in the morning, other ministers and bureaucrats got busy on the social media about the GST achievements and milestones.
Finance Secretary Hasmukh Adhia, armed with data, gave out numbers that pleased the audience comprising traders, industry chamber officials, and bureaucrats. The GST collection for June was ~956 billion, up from ~940 billion in May, Adhia said. The monthly average of GST collections during 2017-18 was much lower at ~899 billion.
GST Day, as the government called it, was also special because Union Minister Arun Jaitley, who had spearheaded the initiative to roll out the tax reform, made his first public appearance since his surgery in May. He spoke to people live through videoconferencing from his residence.
According to a finance ministry statement later on Sunday, of the ~956-billion collection in June, about ~159 billion came as central GST (CGST), ~220 billion in states’ GST (SGST), ~495 billion in integrated GST, and the remaining in cess.
“The total revenue earned by central government and the state governments after settlement in the month of June 2018 is ~316 billion for CGST and ~366 billion for SGST,” the statement said.
PIYUSH GOYAL, FINANCE MINISTER
On average, the government estimates ~1 trillion per month from the GST. At the event, Adhia conceded that while ~1 trillion a month was still not the norm, the Centre hoped to bring gross GST revenues to that level.
Finance Minister Piyush Goyal expressed confidence that monthly GST collections would be much higher than the stated target and reiterated that for 2018-19 gross GST receipts could touch ~13 trillion.
“I assure you that the average monthly GST collection will cross ~1.10 trillion,” Goyal told the audience. “We all know that April to June are lean months. I feel more than ~13-trillion revenue will come from GST this fiscal year,” he said.
THE AVERAGE MONTHLY GST COLLECTION WILL CROSS ~1.10 TRILLION. I FEEL MORE THAN ~13-TRILLION REVENUE WILL COME FROM GST THIS FISCAL YEAR”
Jaitley, who is recovering after the surgery, appeared to speak extempore. “I have seen experiences of countries all over the world where GST caused a major disruption. It is considered to be a disruptive reform. I myself used to use the word disruptive when it came to a major reform like GST because it takes time to settle down. But after one year of experience, I am not too sure whether I can use the word disruptive anymore,” Jaitley said.
GST will have a significant impact in the medium and long term on India’s gross domestic product growth, ease of doing business, and expansion of trade, Jaitley said. “I am confident that the best of GST in terms of its contribution to society is yet to come.” aitley was in sync with Prime Minister Narendra Modi in ruling out a single-slab GST. A single rate was not possible for a nation the size of India, he said, while defending the highest slab of 28 per cent. “So you have a system where the taxation will eventually go down as the tax collection goes up,” he summed up.