GST collections up 18%, cross Rs 1.3 trn in Feb despite Omicron curbs

Goods and services tax (GST) collection in February rose 18 per cent year-on-year to Rs 1.33 trillion, crossing the Rs 1.3-trillion mark for the fifth straight month, the finance ministry said on Tuesday. Government officials expect that the average monthly GST collection in FY23 will be around Rs 1.25 trillion.

The February mop-up reflects economic activity in January, when there were localised lockdowns due to the Omicron wave, and hence gross tax collection was lower than the record Rs 1.4 trillion netted in January, the ministry said. Analysts are confident that GST collection for the current financial year will cross the Budget targets.

“GST collection exceeding Rs 1.33 trillion, despite the challenging pandemic situation, indicates that collections are now on a stable trajectory and the FY22 targets would be exceeded. While on an overall basis, the collection is 18 per cent higher than the same period last year, there is significant divergence amongst states, with increases in the range of 2-23 per cent amongst the large states,” said M S Mani, partner, Deloitte India.

Aditi Nayar, chief economist with ICRA, said GST revenues remained expectedly resilient in February as the third Covid-19 wave had a limited impact on industrial activity and e-way bill generation in January. “With the robust rise in e-way bill generation in February, we expect a sequential uptick in GST revenues in the current month. Moreover, CGST revenues are likely to exceed the Centre’s FY2022 RE by up to Rs 0.3 trillion, complementing the anticipated overshooting in direct taxes,” added Nayar.

Gross GST revenue collected in February was Rs 1,33,026 crore, of which CGST was Rs 24,435 crore, SGST Rs 30,779 crore, IGST Rs 67,471crore, and cess was Rs 10,340 crore, the ministry said. The ministry also said the latest collection was 26 per cent higher than that in February 2020, the period just before the national lockdown.

“During the month, the revenues from import of goods were 38 per cent higher and the revenues from domestic transactions, including import of services, were 12 per cent higher than the revenues from these sources during the same month last year,” it said.

The ministry added that, for the first time, GST cess collection crossed the Rs 10,000-crore mark, which signifies recovery of certain key sectors, especially automobile sales.