The GST collection so far in the current fiscal has contracted by 13 per cent in comparison to the last year.
Even as Finance Minister Nirmala Sitrharaman announced to push the fiscal deficit target of the current year, the low tax collections may still give pain to the government. The GST collections so far in the current fiscal has contracted by 13 per cent in comparison to the last year. “During April-January, the government collected Rs 11.7 lakh crore as GST, which fell to Rs 10.19 lakh crore in the current year, according to the data provided by Anurag Singh Thakur, MoS, Ministry of Finance, in a reply to a question in Lok Sabha today.
The budgeted estimate of GST revenue collection (CGST+ IGST+ GST Compensation Cess) for FY20 is Rs 6.6 lakh crore as against net actual collection of Rs 4.4 crore till December 2019. Including GST, the revised budgeted target of indirect tax collections for the current fiscal is Rs 9.89 lakh crore, out of which only Rs 6.8 lakh crore is collected, which is 68.8 per cent of the annual target. The collections of direct tax in the same duration stood at Rs 6.98 lakh crore, which was 59.68 per cent of the annual target of Rs 11.7 lakh crore.
However, the government is still hopeful that going by the current pace of collections, the annual target will be achieved. “Keeping in view the trends of collection, the revised estimates fixed for direct and indirect taxes in the Financial Year are likely to be achieved,” Anurag Singh Thakur said.
India is going through a phase of prolonged slowdown, which has hit the businesses and the economy’s overall growth as well. Since the businesses are down, the tax collection has taken a direct blow too. Meanwhile, to provide stimulus amid the sagging economy, the Finance Minister Nirmala Sitharaman has announced to stretch the fiscal deficit target for the current and the next year. If the government had not extended the fiscal deficit target, restricting expenditure would have been the only option left in front of the government.