Goods and Services Tax collections crossed ₹1.60 lakh crore in March, the second-highest amount raked in over a single month since the indirect tax system was launched in 2017, in what expert said was a sign of the Indian economy’s ability to withstand global shocks caused by factors such as the war in Ukraine and tightening interest rates by central banks.
The March figure represents a 12.68% year-on-year growth, and takes the total collection for the 2022-23 financial year to a record ₹18.07 lakh crore, according to official data. The previous annual record was ₹14.83 lakh crore in 2021-22.
“The total gross collection for 2022-23 stands at ₹18.1 lakh crore [rounding off ₹18,07,679 crore] and the average gross monthly collection for the full year is ₹1.51 lakh crore,” the Union finance ministry said in a statement.
According to government data for FY23, average monthly collections in the last quarter (Q4 FY23) was ₹1.55 lakh crore, the highest compared to past quarters – ₹1.51 lakh crore in Q1, ₹1.46 lakh crore in Q2 and ₹1.49 lakh crore in Q3.
Experts said GST is a tax on consumption -- the average reaching over ₹1.5 lakh crore signals robustness of the economy, better compliance and general acceptability of the new indirect tax regime.
{{/usCountry}}Experts said GST is a tax on consumption -- the average reaching over ₹1.5 lakh crore signals robustness of the economy, better compliance and general acceptability of the new indirect tax regime.
{{/usCountry}}“With these numbers, any apprehensions on the stability of the GST collections would be set at rest as the collections have been uniformly high with an average of ₹1.5 trillion during the year. The y-o-y increase of 13% represents the consumption stability in the economy together with the compliance and anti-evasion focus adopted by the GST authorities,” said MS Mani, partner at Deloitte India.
Saurabh Agarwal, tax partner at consultancy firm EY said, “While the various parts of world are hit by recession, India manages to seek growth indicates overall tax collection.”
According to the finance ministry, gross GST collections in March 2023 was ₹1,60,122 crore of with Central GST (CGST) component of ₹29,546 crore, State GST (SGST) of ₹37,314 crore, Integrated GST (IGST) at ₹82,907 crore (including ₹42,503 crore on import of goods) and cess of ₹10,355 crore.
“It is for the fourth time, in the current financial year that the gross GST collection has crossed ₹1.5 lakh crore mark registering second highest collection since implementation of GST,” it said. The highest every monthly GST collection was reported in April 2022 at ₹1,67,540 crore.
“This month of March saw the highest IGST collection ever,” it said. IGST is charged on movement of goods and services from one state to another state, and is shared between the centre and states. Out of the March collections, the government has settled ₹33,408 crore to CGST and ₹28,187 crore to SGST from the IGST as regular settlement, the finance ministry said. The total revenue of the centre and states in March 2023 after the IGST settlement was ₹62,954 crore and ₹65,501 crore, respectively.
Abhishek Jain, Partner, Indirect Tax at KPMG in India said collections point towards “the growing trajectory” of the Indian economy. “Another cheer point is the highest ever compliance rate with 91.4% of returns being filed in the month of March, indicating success of revenue authorities and businesses in ensuring tax compliance and preventing tax evasion,” he added.
The month has seen an uptrend in GST returns. It was highest ever at 93.2% for statement of invoices or in GSTR-1 and 91.4% for GSTR-3B as compared to 83.1% and 84.7%, respectively for the same month last year.