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Signalling an economic recovery with most States easing the post second Covid wave curbs, GST collections were back above the ₹1-lakh-crore mark in July. Total collections reached ₹1.16-lakh crore during the month, said the Finance Ministry on Sunday.
This is significant as the GST collections had slipped below the ₹1-lakh-crore mark in June, the first time in eight months. The collections in June predominantly related to May, when most States/UTs were under either complete or partial lockdown.
“With the easing of Covid restrictions, GST collection for July has again crossed ₹1 -lakh crore, which clearly indicates that the economy is recovering at a fast pace. The robust GST revenues are likely to continue in the coming months, too,” a Finance Ministry statement said.
The GST revenues for July are 33 per cent higher than that in the same month last year. while the revenue from import of goods was 36 per cent higher over the same month last year, that from domestic transactions (including import of services) was up 32 per cent.
GST collection of around ₹5,000 crore has been added to the June numbers. Taxpayers were given more time to file returns and assesses were permitted to file return for June till July 5.
Key producing States reviving
All the major producing States have done well, going by the growth of GST revenues during July. For instance, Maharashtra’s GST revenues grew 51 per cent to ₹18,899 crore compared to ₹12,506 crore in the same month last year, data showed. Gujarat’s GST revenues grew 36 per cent to ₹7,629 crore ( ₹5,621 crore).
While Tamil Nadu saw an increase of 36 per cent at ₹6,305 crore (₹4,635 crore), Karnataka’s GST revenues in July grew 12 per cent to ₹6,737 crore (₹6,014 crore). Part of the reason is also the base effect with GST revenues taking a hit in April-June due to the complete lockdown post the onset of the first Covid wave.
Attributing the robust July numbers to economic revival due to the unlock, Rajat Bose, Partner, Shardul Amarchand Mangaldas & Co, said that “If the country is able to resist the third wave, the collections should increase from hereo.”
Abhishek Jain, Tax Partner, EY, said: “This is a definite indicator of economic recovery and the uptrend is expected to continue in the coming months.”
MS Mani, Senior Director, Deloitte India, said that “The fact that major producing States have shown significant increases would indicate that economic activities have resumed across the country.”
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