Hindustan Times (Jammu)

Indirect tax revenue rises 12% in FY2021

- Gireesh Chandra Prasad gireesh. p@ livemint. com

A spike in customs and central excise revenues, led by auto fuel taxes, boosted the central government’s net FY21 indirect tax revenue by 12% from a year ago to ₹10.7 lakh crore, finance ministry data released on Tuesday showed.

Of this, ₹ 5.48 lakh crore came from Goods and Services Tax ( GST) collection­s, ₹ 3.91 lakh crore from central excise and service tax put together, and ₹1.32 lakh crore from customs duty.

While the government crossed its own original and upwardly revised estimates for both customs duty as well as excise plus service tax, in the case of GST, it improved on the downwardly revised target set two months ago, while missing its pre-pandemic estimate.

The Centre collected ₹1.32 lakh crore in customs duty receipts in FY21, up 21% from FY20.

The biggest revenue growth was seen in the excise and service tax category, which swelled 59.59% to ₹3.91 lakh crore in FY21, primarily due to excise collection­s on items such as petrol and diesel that remain outside of the GST ambit.

The ministry did not give a break-up of central excise and service tax, but the arrears on account of service tax—a levy which got subsumed into GST—is a small amount. It was in the range of ₹ 1,400 crore, going by the revised estimates given in Union budget for FY22.

The Union government collected ₹5.48 lakh crore in FY21 in central GST, integrated GST levied on inter-state sales that is settled between the Centre and states and GST cess which is used to compensate states.

This shows an 8.5% contractio­n from what was collected in the year before, but is a 6.4% improvemen­t over the revised estimate of ₹ 5.15 lakh crore. The improvemen­t over the revised estimate also shows the sharp recovery in GST collection­s.

One factor that contribute­d to the recovery in GST receipts especially in the second half of the fiscal is the recovery in economic activity after the national lockdown in the initial months was lifted.

The strong anti- evasion drive and the campaign against entities dealing in fake invoices also helped in boosting GST revenue. This has resulted in the combined GST receipts of the Union and state government­s in March reaching an all-time high of ₹1.24 lakh crore in March.

The 12% increase in net indirect tax collection­s comes on the back of this strong recovery in GST collection­s in the second half of FY21 together, with the significan­t increase in the excise duty collection on petroleum products, said M.S. Mani, senior director at Deloitte India.

Nexdigm executive director (indirect tax) Saket Patawari said considerin­g the economic and financial impact of the pandemic in the first half of the last financial year, a 12% growth in the net indirect tax collection­s is a remarkable feat.

 ?? AFP ?? The Centre collected ₹1.32 lakh crore in customs duty receipts in FY21, up 21% from FY20.
AFP The Centre collected ₹1.32 lakh crore in customs duty receipts in FY21, up 21% from FY20.

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