Goods and services tax (GST) collections rose 15.1% to £16.79 billion in November as strong domestic demand during festival season and the focus on compliance resulted in the fastest pace of expansion since last December.
Latest data released by the finance ministry showed that in November (for transactions in October), integrated GST (IGST) on imports grew 1.5% to £3.91 billion, indicating that shipment of goods into the country slowed down after the double-digit rise reported in the previous month. Overall, IGST collections rose 12.8% to £8.7 billion, indicating that inter-state transactions drove the mop-up.
Central and state GST collections too pointed to strong domestic demand with the former growing 18.5% to £3.04 billiohn in November. State GST kitty swelled 17.1% to £3.82 billion, official numbers showed. The finance ministry said that revenue from domestic transactions, including services imports, was 20% higher on a year-on-year basis.
Some of the tax experts, however, said that the GST department’s notices may have resulted in assessees depositing money.
“Notice issuing time for the year 2017-18 has expired on September 30, 2023 and for FY2018-19 will lapse in December 2023. Due to this, the GST departments have seen heightened activity this fiscal, and this has resulted in burgeoning revenues as demands (notices) are issued by these departments and pre-deposits are collected, even as taxpayers go to appeals,” said Vivek Jalan, partner at Tax Connect Advisory.