In the month of October, the collection of gross tax on goods and services increased by 13.4 percent, i.e. to HRK 1.72 million. This turned out to be the second largest increase since 2017 when the indirect tax regime was introduced. The information was published by the Ministry of Finance on Wednesday. The sharp rise in gross GST could be due to improved economic activity and resolution of disputes between businesses.
What are GST numbers and what do they mean?
During the April-October 2023 timeframe, the average total GST collection is 1.66 lakh crore per month. Earlier, during the April-October 2022 timeframe, the monthly average of GST revenue collection was Rs 1.49 lakh crore.
In the month of October, the total GST collection was Rs.1,72,003. This turned out to be the highest year-on-year growth rate in 10 months. If we talk about ratios, then Central GST was Rs 30,062 crore, State GST was Rs 38,171 crore and Integrated GST was Rs 91,315 crore. Moreover, the tax amounted to HRK 12,456 million.
Compared to the same month last year, revenues from domestic transactions increased by 13 percent, according to a press release from the Ministry of Finance. In the month of October, the government settled Rs 36,614 crore in state GST and Rs 42,873 crore in central GST from the integrated GST. Therefore, the total revenue for October after the settlement is considered to be Rs 74,785 crore for state GST and Rs 72,934 crore for the Centre.
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What could be the reasons behind this increase in GST revenue?
The GST authorities have sent some notices regarding underpayment or refund of non-payment of tax and several companies are seen to have settled the disputes by payment. Experts suggest that the government could potentially consider rate rationalization as the next step under GST.
According to Abhishek Jain, head and partner, indirect taxes, KPMG, the huge increase in collections could be related to dispute resolution for FY17-18, as the normal limitation period ended on September 30. A mid-year collection of increased numbers like this deserves celebration. Moreover, he also says that the ongoing and upcoming spending due to the festivity could help in its continuation.
MS Mani, who is a partner at Deloitte India, said that the increasing emphasis on audits for specific data found in multiple databases has led to a large increase in compliance across countries and sectors. This can also be seen in the increase in GST collection in important areas of production and consumption.
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Source: newstars.edu.vn