GST Revenue Reaches Rs. 1.62 Trillion (1,620,000 Cr.) In September 

In September, both the central and state governments in India collected Rs. 1.62 trillion through the Goods and Services Tax (GST). This amount represents the fourth-highest monthly collection since the GST system was introduced and shows a 10% increase compared to the same period last year. 

The total GST collections for this year align with the projected 10.5% growth rate of the country's nominal GDP as estimated by the finance ministry. These figures reflect improvements in tax administration efficiency and consumption trends.

In September, the central government received Rs. 63,555 crore from inter-state sales taxes, while the states received Rs. 65,235 crore, according to the Union finance ministry. Additionally, the revenue generated from the GST cess imposed on items like luxury cars reached a substantial Rs. 11,613 crore.

The ministry stated that these GST revenue figures align with the official estimates. During the first half of the current fiscal year, gross GST receipts increased by 11% compared to the same period last year, reaching Rs. 9.92 trillion. 

The average monthly gross collection for this fiscal year is Rs. 1.65 trillion, which is 11% higher than the previous year's corresponding period.

Improved administrative efficiency and the inclusion of more micro-enterprises in the GST system have contributed to the growth in GST collections. However, concerns arise due to high inflation, potentially impacting consumer spending. 

On the positive side, government infrastructure projects are stimulating demand and supporting incomes, which could boost consumption.

Consumer spending is flat, with some risk due to high food prices, especially in rural areas. The economy is not primarily driven by consumption.

In August, food prices surged by 9.94%, contributing to an overall inflation rate of 6.83%. The predictions say the economy to grow at 6.3% this fiscal year, slightly below the Reserve Bank of India's projection of 6.5%.

Consumer spending might increase during festivals, but its effect on year-on-year growth remains uncertain. In the first quarter of this fiscal year, household spending, a crucial growth factor, remained quite stable, according to data from the statistics ministry.

In the latest economic review for August, the finance ministry stuck to its projection of 6.5% real GDP growth for the fiscal year. 

It mentioned some positive developments in the second quarter, with improvements in September's monsoon and a drop in food prices that had been driving up inflation. The private sector also showed strength, as per the ministry.

Up to September 16, the central government collected Rs. 8.65 trillion in direct taxes, including tax refunds, showing a 23.5% increase in receipts, and reaching over half of the full-year direct tax target.

Also Read: Statutory & Tax Compliance Calendar – October 2023

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