The Delhi government is hoping for festival season sales at par with last year to make up for lost revenue this year. Deputy Chief Minister Manish Sisodia said while the average reduction in GST collections nation-wide was around 56%, the same in Delhi was sharper at 62%.
“We are banking on the festival season. Even if business is at par with what it was in previous years, it will be a good deal. We are not expecting a better season,” he said.
Like in other states, GST collections dipped significantly in the city, with only a 10th of taxes being collected in April as compared to the same period last year. Since then, the numbers have risen slowly, with collections in July reaching almost 40% of that the year before.
Chief Minister Arvind Kejriwal has been a vocal supporter of reopening the city and businesses and has said, since May, that people will have to learn to live with the virus and restart work while taking precautions such as wearing masks and maintaining social distancing.
Sisodia said that over the past few months, the nature of business and trading in the city has changed: “Earlier, trade was happening through Delhi. Now, we are seeing a lot of direct trading happening… In Delhi, taxes have largely been soft but all taxes are similar across the country now.”
Sources said in August and September, tax collections have been almost 60-70% of last year. Exact figures were not immediately available.
In the past, the government has pushed for reopening of hotels and weekly markets, even after objections from L-G Anil Baijal because of high case count. While the elected government had allowed both to reopen, the L-G stayed the decision saying the situation was not conducive. Sisodia had then written to the Union Home Minister, asking him to direct the L-G to allow reopening. He had said this was crucial as the service sector, which was hit hardest by the lockdown, provided close to 60% of all jobs in the city. Permission to open both was later granted.
Facing financial hardships, the government had in August also issued notices to several traders after it was found many had not paid taxes even for the months of January, February and March. Of the 15,000 taxpayers registered with the government under GST, whose returns were analysed by the government, 10,800 or over two-thirds paid either lower tax or no tax between January and March 2020.
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