GST collection in FY 23 set to cross Rs.20 lakh-crore

Goods and Services Tax (GST) collection in the current financial year ending March 31 is expected to surpass the Rs. 20 lakh crore mark with an annualised growth of approximately 12%, two officials aware of the development said, attributing the increase to heightened economic activity and ease of compliance driven by technology.

Robust collections are also expected for GST cess in the 2023-24 period, with total revenue under the component likely to be around Rs.1.45 lakh crore, the officials added. This increases the probability that it could be rolled back sooner than the March 31, 2026 deadline set initially.

The government extended the GST cess, which is levied on luxury items and so-called sin goods such as automobiles, liquor, cigarettes, aerated water and coal, up to March 31, 2026 to retire the Rs.2.69 lakh crore debt taken to compensate states for their revenue shortfall during the pandemic years. “Cess will cease to exist even before the deadline if the principal and interest amounts are paid early,” one of the officials cited above said.

HT first reported the possibility of an early end to the GST cess on March 20. In the last financial year, the GST collection was a little over Rs.18 lakh crore while the year before that, it was Rs.14.83 lakh crore.

The data up to the last week show that GST collections in the month of March 2024 may significantly exceed Rs.1.60 lakh crore, which will take gross revenues for the entire financial year past the Rs.20 lakh crore mark, a second person said. “A final number will, however, be known only after March 31,” he said.

Read more at: Hindustan Times