Goods and services tax (GST) collections have hit a record of over Rs 1.15 trillion in December against Rs 1.04 trillion the previous month, raising hopes of economic revival. Before this, the highest GST collection was Rs 1.14 trillion in April 2019.
The collections were 10.57 per cent higher month-on-month and 11.65 per cent higher on a year-on-year basis despite the fact that the base was elevated on both the yardsticks. The government had collected Rs 1.03 trillion in December 2019.
December is the third straight month when the collections crossed the Rs one trillion mark.
Abhishek Jain, partner at EY, said, "GST collections crossing Rs 1.15 trillion for the first time ever despite the fact that we are not completely out of the pandemic indicates a remarkable recovery in the economy."
He said some of it could also be due to the plugging of GST revenue leakage by the government on account of fake credits through faudulent invoicing and introduction of e-invoicing. E-invoicing is mandatory for companies with annual turnover of Rs 500 crore form October 2020 onwards and was extended to those with annual turnover of Rs 100 crore from today.
All the segments of GST collections yielded more in December compared to November. For instance CGST collctions rose to Rs 21,365 crore against Rs 19,189 crore, SGST mop increased to Rs 27,804 crore against Rs 25,540 crore. Also integrated GST receipts were more at Rs 57,426 crore against Rs 51,992 crore and compensation cess at Rs 8,579 crore against Rs 8,242 crore.
The finance ministry said in a statement that the GST revenues during December, 2020 have been the highest since the introduction of the indirect tax regime from July, 2017. "It is the first time that it has crossed Rs 1.15 trillion," it said.
Talking about the previous high, the ministry said the revenues of April normally tend to be high since they pertain to the returns of March, which marks the end of financial year.
The month-on-month growth is the highest since last 21 months, the ministry said.
"This has been due to combined effect of the rapid economic recovery post pandemic and the nation-wide drive against GST evaders and fake bills alongwith many systemic changes introduced recently, which have led to improved compliance," it said.
Till now, GST revenues have crossed Rs 1.1 trillion thrice since the introduction of the levy.
The average growth in GST revenues during the third quarter of 2020-21 has been 7.3 per cent as compared to (-) 8.2 per cent during the second quarter and (-) 41.0 per cent during the first quarter of the financial year, the ministry said.