Hindustan Times ST (Jaipur)

GST revenue dips, still over ₹1L cr

- Rajeev Jayaswal

Goods and Services Tax revenue in May remained above the ₹1 lakh crore mark despite many parts of the country being hit by a devastatin­g second wave of the Covid-19 pandemic, which led to lockdowns in key business centres including Maharashtr­a and Delhi from April.

The GST revenue in May -which reflects the actual business activities of the previous month -fell by over 27% to ₹1,02,709 crore compared to the record collection­s of ₹ 1,41,384 crore in April (reflecting actual business transactio­ns of March 2021). The GST collection­s remained above the benchmark of ₹1 lakh crore for the eighth consecutiv­e month.

“The revenues for the month of May 2021 are 65% higher than the GST revenues in the same month last year [₹62,151 crore],” the Union finance ministry said in a statement on Saturday. The Indian economy was hit hard in the first quarter of the previous year because of a 68-day national lockdown since March 25, 2020. The severity of the lockdowns since April this year was lower, with most states allowing manufactur­ing activities to continue.

The GST collection data for a month is normally released on the first day of the following month.

As various deadlines were extended to provide relief to taxpayers from the second wave, they could file returns up to June 4, a finance ministry official said on condition of anonymity.

“The May figure actually reflects business activities from April 1 to April 30. In usual circumstan­ces, business entities have to file returns [GSTR 3B] of these transactio­ns by May 20. Due to the second wave, businesses had been granted more time to file returns,” the official explained. GSTR-3B is a monthly summary statement of business transactio­ns filed by a registered entity.

Out of the ₹1,02,709 crore gross GST revenue collected in May this year, central GST (CGST) was ₹17,592 crore, state GST (SGST) was ₹22,653, integrated GST (IGST) was ₹53,199 crore, including ₹26,002 crore collected on the import of goods. The cess collection was ₹9,265 crore, including ₹868 crore collected on the import of goods, the finance ministry statement said.

“During the month, revenues from import of goods was 56% higher and the revenues from domestic transactio­n (including import of services) are 69% higher than the revenues from these sources during the same month last year,” it added.

Businesses performed poorly last year because of a hard nationwide lockdown for over two months that led to a 24.4% contractio­n of the economy in the first quarter of 2020-21. The economy shrank by 7.3% in the second quarter, before expanding by 0.5% in the three months ended December 31, 2020 and 1.6% in the March quarter. Overall, the Indian economy contracted by 7.3% in 2020-21, according to the GDP statistics released by the National Statistica­l Office on May 31.

MS Mani, senior director at consultanc­y firm Deloitte India, said: “Collection­s of 1 lakh crore pertaining to the transactio­ns of April 21 could possibly indicate that the level of disruption­s in the primary sales due to the lockdown was much lower than what was anticipate­d.”

Most analysts have said the same while revising their growth forecasts for the year only marginally. A Bloomberg poll of 11 economists last week came up with a median growth estimate of 10% in the year, only marginally lower than the 10.5% the same economists projected before the second wave.

Abhishek Jain, tax partner at consultanc­y and audit firm EY said, “Also, the dip in comparison to the collection­s in the previous months was expected as these GST collection­s are for the supplies made in April, when part of the country was in lockdown. It’s noteworthy that the ₹1.02 lakh crores GST collection­s for the month of May will further be increased as businesses having less than ₹5 crore turnover have until 1 week of July to file returns.”

Newspapers in English

Newspapers from India