Goods and Services Tax (GST) collections in September, reflecting actual business transactions for the previous month, may come close to the ₹1.50 lakh crore mark.
With a record 78.21 million e-way bills being generated in the month of August, two people familiar with the data said. According to the current trend, gross GST revenues in September may have already crossed ₹1.47 lakh crore, they added, requesting anonymity. The Union finance ministry is scheduled to release the GST collection figures for the month of September on Saturday.
“This GST [collection] is due to robust business activities, ease of compliance and better tax administration. This trend is also visible from the e-way bills,” one of the two said. E-way bills are required for the movement of goods worth ₹50,000 and above.
According to official data, the number of e-way bills increased about 19% in August 2022 to 78.21 million from 65.89 million in August 2021. Even on a sequential basis, it increased by about 3.5% as compared to 75.58 million in July 2022.
The GST revenue of a particular month reflects actual business transitions undertaken in the previous month and e-way bills, to some extent, are indicators of collections, the first official said. While the GST revenue in August 2022 was ₹1.44 lakh crore, collections for September 2021 (reflecting business transactions in August 2021) was little over ₹1.17 lakh crore.
MS Mani, partner at Deloitte India, said collection trends in previous six months certainly indicate robustness of the economy and e-way bills are also its reflection. “Higher e-way bill generation does show its increased acceptability. It is also because its generation has become simpler and quicker. But it may not be the exact reflection of the GST revenues because many e-way bills could be of lower values,” he said.
“GST collections in the in the last six consecutive months have been above the ₹1.4 lakh crore mark and now the government’s effort is to make the ₹1.5 lakh crore a new normal,” the second person said. “In all likelihood, September collections would be in the range of ₹1.47 lakh crore to ₹1.5 lakh crore, and the monthly collections in the next quarter may see ₹1.5 lakh crore as a new normal,” he added.
Mani said ₹1.5 lakh crore is possible during the festive season and the trend could be visible now because primary dispatches from factory to dealers start early. “Undoubtedly, GST collections are robust and they are the one of the key indicators for the economy.”
Earlier this month, addressing tax officials in Mumbai, finance minister Nirmala Sitharaman spoke about Prime Minister Narendra Modi’s “special mention” of robust GST revenues as a sign of a sound economy, while revenue secretary Tarun Bajaj set a new target of ₹1.5 lakh monthly collections from November .
“You are performing. You keep doing the good work. You are noticed for that. I’m very happy that the honourable Prime Minister — and this is not sharing a secret.., it was a council of ministers’ meeting where officials were present, revenue secretary was there and finance secretary was there…, almost all secretaries to the Government of India were there — the Prime Minister made a special mention of how the economy is sound, how it’s growing well, and month after month we are getting GST revenues which are absolutely stunning ,” Sitharaman said while inaugurating the Kendriya GST Parisar, a residential complex for Mumbai Zone officials at Kharghar in Navi Mumbai.
In fact, monthly average gross GST revenues in the first five months of the current financial year have already crossed ₹1.49 lakh crore, the second official said. According to government data, the financial year 2022-23 started with record ₹1.67 lakh crore revenue in April 2022 . Experts, however say that the April collection was higher because it reflected the actual business transactions of March 2022, the closing month of the previous fiscal year.
For the first time, GST revenue crossed the ₹1.4 lakh crore mark in January this year, but fell below that level the following month ( ₹1,33,026 crore) only to rise again above the benchmark in March and continued the momentum till August with an all-time high of ₹1,67,540 crore in April and the second highest in July, ₹1,48,995 crore.