GST collection slips below Rs 1 trillion in March after four months

The numbers pertain to GST paid in February but collected in March, suggesting that collections might turn grimmer going forward.

Goods and services tax (GST) collection fell below the Rs 1-trillion mark in March after a gap of four months, even as disruptions caused by the coronavirus-induced lockdown will get captured only in the coming months. The numbers pertain to GST paid in February but collected in March, suggesting that collections might turn grimmer going forward. The GST mop-up in March stood at Rs 97,597 crore, down 8.4 per cent on a year-on-year basis, the data released by the Ministry of Finance showed on Wednesday. The government had targeted a collection of Rs 1.25 trillion in March. GST collection grew by a meagre 3.7 per cent in the full fiscal year 2019-20.

The dismal collection in March is despite the stringent anti-evasion measures introduced by the government, including the blockage of e-way bill and restricting input tax credit to 10 per cent in the case of failure of invoice uploads by suppliers. Already hit by an economic slowdown, the country went into a 21-day lockdown from March 24 to prevent the spread of Covid-19. All industries that were struggling have become non-operational, which will reflect in the April GST collection figures.Kerala Finance Minister Thomas Isaac told Business Standard that the April numbers, which would essentially be transactions in March would only be about 15-20 per cent of the March figures.

Pratik Jain, partner, PwC India, said, “It seems that many businesses may not have been able to pay GST because of liquidity issues being faced after the lockdown. As the second half of March 2020 has been significantly impacted due to the Covid-19 outbreak, collections in April are likely to be substantially lower.” In a major relief for businesses facing lockdown due to coronavirus, the last date for GST return filing for March, April and May 2020 has been extended to June 30, with no interest, late fee and penalty, for companies with up to Rs 5 crore turnover and subsidised interest of 9 per cent, and no penalty or late fees for bigger companies.

Move comes ahead of GST Council meeting

In front of the GST Council meeting on Wednesday, the Center on Monday looked to alleviate the frayed nerves of states by discharging over Rs 35,000 crore as pending remuneration. “The focal government has discharged GST pay of Rs 35,298 crore to states and association domains today (Monday),” the Central Board of Indirect Taxes and Customs (CBIC) said in a tweet.

This is probably going to give a positive sign to states for the up and coming gathering, which may take up different choices to raise assets to remunerate states. Prior in the day, Union Finance Minister Nirmala Sitharaman guaranteed states that the Center would not “renege” on the guarantee of GST compensation

There was, nonetheless, some disarray over the period for which the paid sum was discharged. States said with this installment they got pay levy till September. “Pay has been discharged to the states for the long periods of August and September. We are cheerful that remuneration for October and November will be discharged before the month’s over,” Bihar Deputy Chief Minister Sushil Modi revealed to Business Standard.

Prior, Parliament’s Standing Committee on Finance had said the Center had paid Rs 45,745 crore as pay to states for the initial four months of the current money related year. The duty was paid in June and August. Be that as it may, as indicated by Sitharaman’s announcement in the Rajya Sabha, the Center had discharged remuneration of Rs 65,250 crore till October this year…

FM Sitharaman guarantees conditions of discharging GST pay contribution soon

Sitharaman on Wednesday said the Center was compelled by a solemn obligation to protect the enthusiasm of states

Association Finance Minister Nirmala Sitharaman on Wednesday guaranteed states that the merchandise and ventures charge (GST) remuneration because of them for August and September will be discharged soon. She, be that as it may, didn’t determine a course of events. Money priests (FMs) of Punjab, Kerala, Delhi, Rajasthan, Chhattisgarh, and Madhya Pradesh had met Sitharaman on Wednesday and encouraged that assets due for four months since August be discharged as quickly as time permits.

The issue could turn into a significant one at the GST Council meeting on December 17-18 in New Delhi. Punjab FM Manpreet Singh Badal said Sitharaman guaranteed them the cash will be discharged soon. “Remuneration for October and November is additionally due,” he included.

The August and September remuneration duty for Rajasthan are Rs 4,400 crore, for Punjab it is Rs 2,100 crore, for Delhi it is Rs 2,355 crore, for Kerala it is Rs 1,600 crore, and for West Bengal it is Rs 1,500 crore. Delhi’s Deputy Chief Minister Manish Sisodia said Nirmala Sitharaman didn’t determine the motivation behind why the pay was being held up. “The Center owes Rs 3,600 crore to Delhi for August, September, and October,” he included.

Cess assortments under the GST to remunerate states for income misfortune have missed the mark regarding prerequisites in the current monetary year by virtue of stoppage popular. Under the law, if the states’ GST income doesn’t develop by at any rate 14 percent, the Center pays them the distinction after at regular intervals.

Madhya Pradesh (MP) Commercial Tax Minister Brajendra Singh Rathore said the Center owes the state Rs 3,000 crore for August to September. The state has fared the most exceedingly terrible in GST assortment in 2019-20 (FY20), rounding up 30 percent of the yearly target. Kerala, Punjab, and Tamil Nadu have gathered around 33 percent, shows the information on the Comptroller and Auditor General of India site…

GST mop-up crosses Rs 1 trn in Nov over festive demand, anti-evasion steps

Although the collection figures come as a breather for the government, it is lower than the expected collection rate needed to meet the steep target for FY20

Goods and services tax (GST) collection recovered to a seven-month high in November, crossing the Rs 1-trillion mark on account of the festive season demand and anti-evasion measures by the government. After two months of negative growth, the GST mop-up grew by 6 per cent in November over the corresponding period last year to Rs 1.03 trillion, against Rs 95,380 billion in October, the data released by the Ministry of Finance showed on Sunday. These figures are for October, collected in November.

Although the collection figures come as a breather for the government, it is lower than the expected collection rate needed to meet the steep target for 2019-20 (FY20). The government’s monthly GST collection target is around Rs 1.18 trillion. Being a festival month, GST collection on domestic transactions witnessed a 12 per cent growth — the highest during the year. GST collection on imports continued to see negative growth of (-)13 per cent, against (-)20 per cent in October.

“This is the eighth time since the inception of GST in July 2017 that the monthly collection has crossed the Rs 1-trillion-mark. Also, the November 2019 collection is the third-highest monthly collection since the introduction of GST, next only to April 2019 and March 2019 collections,” the Ministry of Finance said in a release….Read More

Milk, Mercedes can’t be taxed at single GST rate, says PM Narendra Modi

To criticism that the GST was ‘hurriedly implemented’, the PM said the government had been responsive, with issues identified and redressed in real time

 

Prime Minister (PM) Narendra Modi on Sunday ruled out a single slab for the goods and services tax (GST), stating that milk and the Mercedes could not have the same rate.

The GST regime was rolled out on July 1 last year. The central government on Sunday marked its first anniversary with an event in New Delhi, while Modi took to social media to showcase its advantages.

In an interview to Swarajya, a news website, Modi responded to criticism of his government’s version of the GST. He ruled out a single tax slab, pointed at the gains of the past one year, and admitted to teething troubles having plagued the regime in its first year.

To the Congress party’s criticism that there should be a single tax rate, he said: “It would have been very simple to have just one slab but it would have meant we could not have food items at 0 per cent tax rate. Can we have milk and Mercedes at the same rate?”

“So, when our friends in the Congress say that they will have just one GST rate, they are effectively saying they will tax food items and commodities, which are currently at 0 or 5 per cent, at 18 per cent,” Modi said.

To criticism that the GST was “hurriedly implemented”, the PM said the government had been responsive, with issues identified and redressed in real time.

The PM did not rule out the possibility that tax rates could come down further on some items. He said the government had reduced taxes on nearly 400 groups of items, and around 150 groups have a 0 per cent tax rate.

Modi also responded to the Opposition’s charge that the GST was “anti-people” by sharing on Twitter and the NaMo app the advantages the tax reform had brought for the common people. With the assembly elections scheduled in three key North Indian states in the next five months, and the Lok Sabha elections due in less than nine months, the PM tweeted that “decreasing prices”, because of the GST, were “helping poor and middle class”.

He also reached out to small businesses, a key support base of the Bharatiya Janata Party (BJP), and said the tax reform had provided “increasing opportunities for small and medium entrepreneurs”. With the hashtag “GST for New India”, the PM tweeted that the GST had brought growth, simplicity, and transparency. He said it had boosted formalisation, enhanced productivity, and furthered “ease of doing business”.

The PM said the GST had been designed to “eliminate inspector raj with the help of information technology”, and suggested that the GST roll-out was consistent with his vision of “minimum governance”.

The PM in his last radio broadcast had said the tax reform was an example of cooperative federalism with decisions in all 27 GST Council meetings having been reached by consensus.

Modi said the number of enterprises registered since Independence until June 30, 2017, was 6.6 million. He said in just one year after the introduction of the GST, the number of new enterprises registered was 4.8 million. He said around 3.5 billion invoices were processed, 110 million returns were filed, and 100 million e-way bills generated. “Would we be looking at such numbers, if GST were indeed very complex?” Modi asked.

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