Maharashtra leads in GST cess mop-up

Maharashtra, Karnataka, Uttar Pradesh, Odisha and Tamil Nadu are leading in collecting Goods and Services Tax (GST) cess levied mainly on sale of cars, helping the Centre pay off the market loans taken to give liquidity to states during the pandemic, showed data available from the GST Council for this fiscal up to January 2024.

Largest state economy Maharashtra leads the list with a collection of ₹19,125 crore in the April-January period of the current financial year, followed by Karnataka with ₹13,738 crore and Uttar Pradesh with ₹ 13,004 crore. Odisha collected ₹7,729 crore of cess, while Tamil Nadu reported ₹7,291 crore. Gujarat, Haryana, Jharkhand and West Bengal are the other big contributors of GST cess.

GST cess is levied on automobiles, aerated drinks and tobacco which are in the 28% GST slab. The rate of cess varies depending on the product and specifications.

It ranges from 1% in the case of petrol, CNG or LPG vehicles meeting certain conditions and 22% in the case of sports utility vehicles to 290% in the case of certain smoking mixtures for pipes and cigarettes.

This levy will lapse in March 2026 or earlier but, based on the need for mobilizing revenue, some form of tax may replace it depending on a decision to be taken by the federal indirect tax body, the GST Council, Mint reported on 12 February.

Official data also showed that Maharashtra and the most populous state Uttar Pradesh topped in terms of proceeds of integrated GST or IGST on cross-border trade, settled by the Central government.

The importing state gets proceeds of IGST under the indirect tax system. Maharashtra has received ₹39,684 crore of IGST settlement so far this financial year, while Uttar Pradesh received IGST settlement of ₹37,436 crore. The other major recipients of IGST proceeds include Karnataka, Tamil Nadu, Rajasthan and Telangana.

Maharashtra, Gujarat, Karnataka and Tamil Nadu remained the top performing states in terms of collecting GST on goods and services sold in the state. Maharashtra collected ₹83,114 crore of state GST or SGST so far this fiscal, followed by ₹34,656 crore by Gujarat, ₹33,785 crore by Karnataka and ₹27,044 crore by Uttar Pradesh. The figures confirm that some of the industrialized state economies like Maharashtra, Karnataka and Tamil Nadu are also major importers as well as consumers of locally produced goods and services.

GST revenue receipts of the Centre and states have so far shown year-on-year growth of 10-15% in each of the 11 months so far this year. GST receipts which grew at 11.63% in April last year, had seen a sharp spike during the festive months of October and November when collections showed a growth of 13.37% and 15.12% respectively. In February, collections went up 12.54% to ₹1.68 trillion. The monthly average collection is ₹1.67 trillion, as per data available from the finance ministry.

GST cess is levied on automobiles, aerated drinks and tobacco which are in the 28% GST slab