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GST collection jumps 28% YoY in July to second highest ever at Rs 1.49 trn

Collection remains above Rs 1.4 trn for fifth straight month

GST
All major states have reported growth above 15 per cent during the period
Shrimi Choudhary New Delhi
4 min read Last Updated : Aug 01 2022 | 11:25 PM IST
Goods and services tax (GST) collection remained above Rs 1.4 trillion for the fifth month in a row, increasing 28 per cent year-on-year (YoY) to nearly Rs 1.49 trillion in July. This was the second-highest mop-up since the rollout of the regime.

The uptick is mainly on account of improved economic activities, compliance measures and inflation. The highest-ever mop-up was recorded in April this year (Rs 1.68 trillion).

“GST revenue has grown 35 per cent YoY till July, displaying very high buoyancy,” the finance ministry said while releasing the data on Monday.

The finance ministry also said that this was an impact of various measures taken by the GST Council to ensure better compliance.

“Better reporting, coupled with economic recovery, has had a positive impact on the revenues on a consistent basis,” the ministry said.

GST collection stood at Rs 1.16 trillion in the corresponding period of the previous fiscal year, according to the government data.

Of the mop-up in July, Central GST (CGST) stood at Rs 25,751 crore, state GST (SGST) Rs 32,807 crore, integrated GST (IGST) Rs 79,518 crore (including Rs 41,420 crore collected on import of goods), and cess mop-up Rs 10,920 crore (including Rs 995 crore from import of goods).

The data further showed that the number of e-way bill generated in June was 74.5 million, higher than the 73.6 million in May. In July, revenue from import of goods and domestic transactions (including import of services) stood at 48 per cent and 22 per cent higher than the same month last year.

Experts say that rising inflation has contributed to the momentum in the revenue collection which could provide a cushion to the states as the guaranteed compensation period ended in June.

“The GST collection reported a healthy trend, rising for the second month in a row, and is a function of the economic recovery, better compliance as well as elevated inflation. With the headline GST collection in July exceeding our monthly average forecast of Rs 1.45 trillion for this year, we foresee an upside of Rs 1.15 trillion, relative to the FY2023 BE for CGST collections,” said Aditi Nayar, chief economist, ICRA.

Notably, over the last three months, inflation has remained above 7 per cent, though it declined from 7.79 per cent in April to 7.04 per cent in May and 7.01 per cent in June.

“The new normal of Rs 1.4 trillion, accompanied by the fact that all major states have shown a growth in excess of 15 per cent over the past year, indicates that economic activities have stabilised and the leakages have been plugged. The uptick in collection would provide some comfort to states which have just come out of the guaranteed compensation period and are concerned about their revenue mobilisation abilities,” said MS Mani, partner, Deloitte India

In July, the government has settled Rs 32,365 crore to CGST and Rs 26,774 crore to SGST from IGST, the ministry said. The total revenue of the Centre and states in July, after regular settlement, is Rs 58,116 crore for CGST and Rs 59,581 crore for the SGST.

State-wise collection

All major states have reported growth above 15 per cent during the period. In absolute terms, Maharashtra collected the highest GST (Rs 22,129 crore), followed by Karnataka (Rs 9,795 crore), Gujarat (Rs 9,183 crore), Tamil Nadu (Rs 8,449 crore), Uttar Pradesh (Rs 7,074 crore), Haryana (Rs 6,791 crore), Telangana (Rs 4,547 crore), West Bengal (Rs 4,441 crore), Delhi (Rs 4,327 crore) and Rajasthan (Rs 3,671 crore), according to the data. However, the collection figures do not include GST on the import of goods.

In terms of growth, Lakshdweep witnessed the highest jump in GST collection (69 per cent) compared to July 2021. It was followed by Puduchery and Ladakh (54 per cent each), Nagaland (48 per cent), Karnataka (45 per cent) and Goa (43 per cent).

However, two states posted negative growth. Bihar reported a decline of 1 per cent, compared to July 2021, while Tripura saw a 3 per cent fall.

Topics :GST collectionsGSTIndian EconomyGST council meetinggoods and service taxeconomyGST revenue collectionGST revenuescgst

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