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Published: November 2, 2023
Updated: November 2, 2023

Record-Breaking October: GST Collections Soar by 13% to Reach Rs 1.72 Trillion

Stricter Measures and Festival Season Boost GST Collections

In a remarkable turn of events, India's Goods and Services Tax (GST) collections in October surged by an astounding 13%, reaching a staggering Rs 1.72 trillion. This surge can be attributed to stricter anti-evasion measures and the increased consumer spending during the festival season. It marks the second-highest monthly collection ever, just behind April 2023, when Rs 1.87 trillion was collected.

Consistent Growth in FY24

The October collection figure, which was 5.5% higher than the previous month's Rs 1.63 trillion, has contributed to an average monthly GST collection of Rs 1.66 trillion for FY24, reflecting an impressive 11% year-on-year increase. Notably, this marks the eighth consecutive month with collections exceeding Rs 1.5 trillion, indicating a consistent growth trend.

Domestic Transactions and Stricter Tax Measures

Revenue from domestic transactions, including the import of services, saw a 13% year-on-year increase in October. This remarkable growth in GST collections can be attributed not only to robust economic factors but also to the efforts of tax authorities in employing sophisticated tools to identify and rectify instances of underpayment and evasion. M.S. Mani, a partner at Deloitte India, highlighted this crucial factor.

Breakdown of Collection

Breaking down the total gross collection, Central GST (CGST) accounted for Rs 30,062 crore, state GST (SGST) for Rs 38,171 crore, integrated GST (IGST) for Rs 91,315 crore (including Rs 42,127 crore collected on imported goods), and cess for Rs 12,456 crore (including Rs 1,294 crore on imported goods). Additionally, the government settled Rs 42,873 crore to CGST and Rs 36,614 crore to SGST from IGST. The total revenue for the Centre and states for the month after regular settlement came to Rs 72,934 crore and Rs 74,785 crore, respectively.

Optimistic Outlook for the Festival Season

Experts anticipate this upward trend to persist throughout the festival season, as the strong GST collection in October reflects the resilience of the Indian economy. With festivities driving consumption, the collections in the upcoming month are expected to remain robust.

State-Wise Growth

Interestingly, the rise in collections was not limited to specific regions but extended to states like Jammu & Kashmir, Mizoram, Ladakh, Lakshadweep, Meghalaya, and Sikkim, indicating increased consumption and taxable bases in these areas. Across states, the growth rate exceeded 10%, with Maharashtra, Karnataka, Uttar Pradesh, and Tamil Nadu recording impressive growth rates of 14%, 12%, 10%, and 9%, respectively.

An Encouraging Outlook

The robust growth in October's GST collections, driven by stricter tax measures and festive consumer spending, paints a promising picture for India's economic resilience. As the festival season unfolds, the momentum is expected to persist, providing a bright spot amidst economic challenges. The GST collection trends are indicative of a thriving Indian economy, which bodes well for the country's fiscal health.