Finance Minister Piyush Goyal on Sunday exuded confidence that GST collections will exceed Rs 13 trillion in the current fiscal and with increased revenues there will be further scope to rationalise the tax rates.
He said with more number of people coming under the tax net, and successful implementation of eway bill system, there will be scope for rationalisation of tax slabs.
Under the four-tier Goods and Services Tax (GST), which was rolled out on July 1, 2017, taxes are levied in the brackets of 5 per cent, 12 per cent, 18 per cent and 28 per cent. On top of the highest tax bracket, a cess is levied on luxury, sin and demerit goods.
I assure you that average monthly GST collection will cross Rs 1.10 trillion ... I feel more than Rs 13 trillion revenue will come from GST this fiscal, Goyal said at the 'GST-Day' celebrations in New Delhi.
In the first year of GST in 2017-18, the government earned Rs 7.41 trillion from the tax since its roll out in July. The average monthly collection was Rs 898.85 billion.
In the current fiscal, the collections in April touched a record Rs 1.03 trillion, followed by Rs 940.16 billion in May and Rs 95.61 billion in June.
He said historically the three month from April to June are lean periods of tax collection. In the earlier indirect tax regime 7.1 per cent of taxes used to get collected in the three months. "So 940 billion collection is music to my ears," he said.
"The more people get into the honest and transparent system and with the success of e-way bill system, we will be in a better position to rationalise tax slabs. The different rate slabs were kept after considering the social structure of the nation.... Is it proper to tax luxury cars and items of common items used by poor people?" Goyal said.
The minister also asked Finance Secretary Hasmukh Adhia to look into the option of allowing composition scheme dealers to file returns yearly, instead of quarterly at present.
The small and medium enterprises can opt for composition scheme which provides for a 1 per cent tax for traders and manufacturers while 5 per cent for restaurants.
The GST Council had last year decided to increase the turnover threshold for opting the scheme to Rs 15 million and also decided to amend the law to increase the statutory threshold to Rs 200 million.
He also said that the Ministry would soon set up a system where businesses can discuss their problems relating to GST with revenue officials every month.