Goods and services tax (GST) collection for April indicates a structural shift. Collection touched an all-time high of Rs 1.41 trillion in April against Rs 1.24 trillion in March. The GST mop-up has been in excess of Rs 1 trillion for seven months in a row. There could be multiple reasons for the jump witnessed in April. Since collection in April reflects transactions in March, it is likely that businesses deposited pending dues before the end of the fiscal year, which pushed up the total collection. It is also likely that economic recovery was gathering momentum, which led to higher activity and tax collection. Another reason — and perhaps the most important — could be significant improvement in compliance, which also explains higher tax collection over the last few months.
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