November GST collection grows 6%, brings cheer after dismal GDP numbers

Indian economy facing slowdown
IMF chief economist Gita Gopinath blames Indian economy for the cut in global growth forecast.

After two bad months, the Goods and Services Tax collection picked up in the festival month of November, bringing some cheer to the Narendra Modi government which is troubled by a flurry of poor numbers in key indicators in recent months. The GST collection for November grew by 6% to Rs 1,03,492 crore compared with Rs 97,637 crore in the same month last year. The mopup for the month is the third highest since GST was introduced in July 2017. This is the eighth month that the indirect tax mopup crossed Rs 1,00,000 crore mark.

 

The robust November revenue collections indicates some pickup in economic activity as the mopup from domestic transactions witnessed a growth of 12%, the highest in the current year. The collection on imports shrank by 13%, but is higher than October when collections fell by 20%.

 

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The healthy GST collection in November indicates that the economy is still vibrant,” said Charan Singh, CEO of EGROW Foundation, a Noida-based think tank. The tax cuts and other measures will boost the economy in the second half of the fiscal that could improve GST collection further, he added.

 

The November mopup includes Rs 19,592 crore from central GST, Rs 27,144 crore from state GST and Rs 49,028 crore from integrated GST that comprise Rs 20,948 crore collected on imports, a finance ministry press release said. The total indirect tax collection by the central and the state governments in November stood at Rs 44,742.

 

 

The GST numbers will offer some relief to the government as it closely follows the dismal second quarter GDP growth number of 4.5%, which was the lowest in six years. The worries about a slowdown still persist as the demand is still low.

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