Even as the monthly GST collection hit a record high in April giving a boost to the Narendra Modi government, it might not be a cause of celebration yet, with the impending refunds set to bring the collection back down to normal levels.
Even as the monthly GST collection hit a record high in April giving a boost to the Narendra Modi government, it might not be a cause of celebration yet, with the impending refunds set to bring the collection back down to normal levels. Further, going ahead, the GST collection may fall short of the required run rate of Rs 1.15 lakh crore to meet the F20 estimated target of Rs 13.7 lakh crore, a research report said.
The GST refunds, yet to be processed, may bring the April collection figure to Rs 1.04 lakh crore, down from Rs 1.13 lakh crore collection reported by the government yesterday, Kotak Research said in the report. The pressure on the fiscal health of the government may continue if GST mop-up in the next few months doesn’t match the targeted figure, it added.
The rise in collections may be positive for the government, but it’s likely on account of year-end adjustments in FY19, the report said. The tax liability-computation of the annual return filing for the FY18, whose due date is June 30, and data-analytics based action against tax evaders may have helped in the increase, experts said.
Watch: GST collection rise to record high
It’s the second time in a row that GST collections topped Rs 1 lakh crore-mark. What follows in coming months would be watched closely, the report noted. It seems difficult for the government to record the budgeted mop-up growth rate of nearly 24 per cent for FY20E, the report added.
The rise in collections may be have to do with year-end adjustments and corrections, the steady growth in collections in the last couple of months is laudable, Abhishek Jain, Tax Partner, EY India, said.
The total gross GST collections in April 2019 stood at Rs 1,13,865 crore. Of the total collections, Central GST is Rs 21,163 crore, State GST (SGST) is Rs 28,801 crore, Integrated GST is Rs 54,733 crore and cess is Rs 9,168 crore, the government said in a statement on Wednesday. The average collections for March to April 2018 was recorded at Rs 103,500 crore.