The total gross Goods and Services Tax (GST) revenue grew 8.5% to over Rs 1.82 lakh crore in November as compared to Rs 1.68 lakh crore in the same month a year ago, data released by the finance ministry showed on Sunday.
With the November collections, the cumulative gross GST mop-up in the first eight months of FY25 came in at Rs 14.6 lakh crore, 9.3% higher than the corresponding period of FY24. The growth in gross collections in the April-November period, however, is less than what finance ministry officials had anticipated for the full year at 11%.
In April-November, gross GST collections from domestic activity were up 10.3% on year at Rs 11.04 lakh crore, but from imports, the growth was up merely 6%, which dragged down overall growth.
MS Mani, partner, Deloitte India, said: “The domestic GST revenue growth of 10% plus in FY25 seems to support the GDP data which indicates an increase in domestic consumption. The import GST revenue growth of 6% also backs foreign trade data which indicates slower growth of non-petroleum imports.”
The total GST refunds issued in April-November stood at Rs 1.66 lakh crore, up 10.2% on year; and thus the net GST mop-up stood at Rs 12.9 lakh crore, 9.2% higher than the corresponding period of FY24.
In November, the gross GST domestic revenue was up 9.4% on year at Rs 1.4 lakh crore, and gross GST import revenue was up 5.9% at Rs 42, 591 crore. Experts say that with the economy growing at a slower pace, imports may remain down for some time, and consequently the GST collections.
Saurabh Agarwal, tax partner, EY India, said: “Considering the recent GDP data for the September 2024 quarter, we anticipate a slowdown in tax collections over the next four months.”
Agarwal said that month-on-month collections have declined (October was Rs 1.87 lakh crore) even after the festive boost. “The global geopolitical scenario and potential consumer spending cuts could further exacerbate short-term economic growth,” he said.
The Central GST (CGST) collections in November were up 12.2% on year, and the State GST (SGST) mop-up was up by 12.6%. The collections from Integrated GST (IGST) were up by only 5.5%, and from cess by 8%.
For the April-November period, collections from CGST were up 10.2% on year, and from SGST by 9.2%. IGST and cess collections were up 9.4% and 6.5%, respectively, in the period.
Vivek Jalan, partner, Tax Connect, said that the income tax numbers and GST numbers seem “dichotomous”. While YTD direct tax collections till November 10 have grown by more than 15%, the YTD GST collections in around that period have grown by only 9.3%. “This shows that while income levels are growing in India yet consumption is not aligned accordingly,” he said.
Experts further say that since gross collections growth is below expectations and also lower than the nominal GDP growth projection of 10.5%, the buoyancy of GST collections is likely to be below one this year. “This may require some food for thought for the GST Council as it meets on December 21,” said Jalan.
