Representative image | Photo: AFP
New Delhi: India's tax collection from the sale of goods and services soared 28 per cent to Rs 1.43 lakh crore in July aided by rising demand, higher rates, and greater compliance.
The GST collection remained above the Rs 1.4-lakh-crore mark for the sixth straight month in August and the ensuing festival season will help continue the trend.
Better reporting coupled with economic recovery has have a "positive impact on the GST revenues on a consistent basis”, the finance ministry said in a statement.
The gross GST revenue collected in August 2022 is Rs 1,43,612 crore of which CGST is Rs 24,710 crore, SGST is Rs 30,951 crore, IGST is Rs 77,782 crore (including Rs 42,067 crore collected on import of goods) and cess is Rs 10,168 crore (including Rs 1,018 crore collected on import of goods), the ministry said.
The revenues for the month of August 2022 are 28 per cent higher than the GST revenues of Rs 1,12,020 crore collected in August 2021.
"The growth in GST revenue till August 2022 over the same period last year is 33 per cent, continuing to display very high buoyancy. This is a clear impact of various measures taken by the Council in the past to ensure better compliance,” the Ministry said.
The collection in August is, however, lower than Rs 1.49 lakh crore collected in July. The mop up was at a record high of Rs 1.67 lakh crore in April.
KPMG in India Partner Indirect Tax Abhishek Jain said, "The consistent high collections indicate upward economic trajectory despite fluctuating COVID cases and to some extent attributable to inflation and better compliance being ensured by the government."
N A Shah Associates, Partner, Indirect Tax, Parag Mehta said the collection increase is due to better compliance and the removal of various exemptions from July 2022.
"Further, with the festive season setting in, the collections for the next 2-3 months will also show an upward trajectory,” Mehta said.
Deloitte India Partner MS Mani said the collections reflect the strength of the underlying economic factors.
"With the onset of the festival season, which is typically a large consumption driver for all businesses, the GST collections in the coming months would also be expected to be robust," Mani added.
Nexdigm, Director Indirect Tax, Sanjay Chhabria said higher collections are signs of recovery of trade & economy post the COVID-19 pandemic and we could continue to witness such higher tax buoyancy during the upcoming festivities in the country.
ICRA Chief Economist Aditi Nayar said looking ahead, the YoY growth in GST collections is likely to remain well above 20 per cent in September 2022, before tempering down to 12-15 per cent in December quarter, on a normalising base, trending close to the nominal GDP expansion.
"We continue to foresee a considerable upside in the CGST collections relative to the FY2023 BE, more than offsetting the expected loss in excise collections," Nayar said.