For first time this fiscal, TN GST collections show yoy growth in Sept

G Balachandar Chennai | Updated on October 01, 2020 Published on October 01, 2020

Compared to other developed States, Tamil Nadu’s collections were much better

Tamil Nadu’s economy appears to be returning to normal as GST collections have reported a strong growth in September after a gap of several months.

Total GST collections in Tamil Nadu grew 15 per cent at ₹6,454 crore in September 2020 when compared with ₹5,616 crore in the same month last year.

“When I submitted my report, I said that normalcy will come in the next few months. I said it based upon what’s happening to the GST collections due to the consumption of electricity and a few other things. I think it looks like this GST collection means economic activity is approaching normal,” C Rangarajan, former RBI governor told BusinessLine.


Rangarajan headed a high-level committee to advise the Tamil Nadu government on the medium-term response and measures required to boost the economy post the lockdown period. He submitted his report on September 21.

“Of course, one has to analyse the GST data more closely to see whether it reflects the activity in that particular month or if there is some past accumulation or compensation of previous months. Otherwise it only indicates that we are approaching the normal,” he said.

‘But ground lost’

However, he pointed out that it is not making up for what has been lost in the first few months of this fiscal and that is a different issue. To make it up during the year really requires a much faster rate of growth over previous year, Rangarajan said.

Compared to other developed States such as Maharashtra, Karnataka, Gujarat and Uttar Pradesh, Tamil Nadu’s September GST collections were much better. “This is first month in this fiscal which has positive y-o-y growth. The state-wise production and consumption structure is responsible for varying degree of GST growth,” says Devendra Pant, Chief Economist and Head Public Finance, India Ratings said.

Maharashtra, which continues to see increasing Covid-19 infections, and Uttar Pradesh reported flat GST collections at ₹13,546 crore and ₹5,075 crore respectively in September 2020.

While Gujarat reported a six per cent increase in GST revenue at ₹6,090 crore, Karnataka, which announced a complete lift of lockdown earlier than other States, reported a five per cent dip in collections at ₹6,050 crore.

Growth in 2019-20

In 2019-20, Tamil Nadu’s GST collections stood at ₹74,430 crore, up 5 per cent over the previous year. Maharashtra recorded ₹ 1.85 lakh crore (9 per cent); Gujarat ₹78,923 crore (7 per cent) and Karnataka ₹83,408 crore (6 per cent). Uttar Pradesh’s total collections stood at ₹65,281 crore, up 6 per cent. Even as the state continues to control the Covid-19 infection levels, Tamil Nadu adopted a gradual lifting of restrictions. From September 1 onwards, the State removed restrictions on people movement between districts along with other relaxations to support the revival of economic activity.

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Published on October 01, 2020
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