Goods and Services Tax (GST) collection in the April-June quarter declined 41 per cent to Rs 1.85 lakh crore, data released from the Finance Ministry on Wednesday showed. While the month-on-month collections showed a pick up in June, rising to Rs 99,940 crore, from a record low of Rs 32,394 crore in April in what can be seen as a sign of greater economic activity amid easing of lockdown for COVID-19, the recovery could also be partly attributed to delayed payments from previous months as deadlines were extended, officials said.
Finance and Revenue Secretary Ajay Bhushan Pandey said that 70-80 per cent of the June collection would have come from transactions in May. “We are doing that exercise to find out from the available data but my estimate is that 70-80 per cent of the June collection would have come from transactions in May,” he told The Indian Express.
The Finance Ministry in its release said the revenues have been impacted due to the pandemic and relaxation in return filing and tax payment deadlines. “The revenues during the financial year has been impacted due to COVID-19, firstly due to the economic impact of the pandemic and secondly due to the relaxations given by the Government in filing of returns and payment of taxes due to the pandemic. However, figures of the past three months show recovery in GST revenues,” the release said.
In April, which reflects GST revenues for sales in March, the GST revenue declined 71.6 per cent to Rs 32,294 crore. In May, the collections were recorded at Rs 62,009 crore, a decline of 38.2 per cent over the same period last year, while in June, the collections declined 9 per cent to Rs 90,917 crore.
Revenue trend to be key
GST collection on a month-on-month basis has, however, shown a recovery, partly due to pickup in economic activity and overdue payments from previous months. Revenue trend in coming months will be crucial for the government to be able to meet its expenditure along with compensation payments to states.
“The government collected gross #GST revenue of Rs 90,917 crore in June 2020, which is 91 per cent of the collections in June 2019,” Office of Finance Minister Nirmala Sitharaman tweeted.
Detailed breakup for GST collections raised in various states showed that most states recorded a decline in GST collections in June. However, states such as Punjab, Chhattisgarh, Madhya Pradesh, Bihar, Andhra Pradesh, Telangana, Karnataka along with north eastern states of Assam, Sikkim, Manipur, Mizoram, Tripura, Nagaland and Arunachal Pradesh recorded growth in GST collections in June over last year.
Tax experts said even though GST collections have declined for the quarter, signs of recovery are there in June.
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