GST Revenue Records Fastest Growth Since 2022 With 16% Increase

Goods and services tax (GST) collections increased 16.4% to Rs 2,01,050 crore in May. This is the fastest Growth in GST Revenue since October 2022, which is mainly due to the rise in import taxes.

As per the Recent data, the GST collections on imports increased 25.2% to Rs 51,266 crore during May (for transactions in April). While the domestic GST collections, which are 75% of the overall kitty, increased 13.7%, reaching just under Rs 1.5 lakh crore.

The imports in April rose by 19%, reaching almost $65 billion. This big increase was mainly due to the shipments of crude oil and fertilisers, among other items. The 16% growth in GST revenue indicates a strong rise after a few months, when the growth was only about 11% to 12%.

As per an expert, if this kind of growth in GST collections continues for the next few months, it could give the government a cushion to possibly reduce or simplify tax rates, which they have already been doing. The government sources reflected that the finance ministry is working to rationalise GST rates.

The net collections stood at 20.4% higher at Rs 1,73,841 crore as the refunds were 4% less at Rs 27,210 crore, even after the domestic refunds rose 53.7% to Rs 18,314 crore.

However, there was a huge difference in the GST collection among different states. Some states saw high growth, including Arunachal Pradesh (53%), Nagaland (46%) and Delhi (38%), followed by Tamil Nadu (25%), Kerala (24%), Bihar (23%) and Karnataka (20%) in the middle.

On the other hand, some states saw a significant fall, including Andhra Pradesh (2% fall), Uttarakhand (13% fall) and Mizoram (26% dip). This huge variation could possibly be due to seasonal factors.