In the first seven months of FY24, the average monthly GST mop-up stood at Rs 1.7 trillion, which is 11% higher than the corresponding period of last year.
The tax rates of essential goods and services have comedown since the inception of Goods and Services Tax (GST) in 2016, and consumers are paying “far less” taxes compared to what they used to pay pre-2016, Finance Minister Nirmala Sitharaman said on Tuesday.
“Consumers know today that post-GST, the rates that they pay in tax does not have double taxation or overlaps…and therefore they are paying far less tax today for essential goods and services than what it was in the pre-GST era… GST has very efficiently brought the rates down…and that’s why the collections are going up,” she said at the inauguration ceremony of 12 GST Seva Kendras held at Vapi in Gujarat.
As per an RBI report, the weighted average tax rate under GST regime rate fell from 14.4% at the time of inception to 11.6% in 2019 as a consequence of a series of tax cuts between November 2017 and December 2018.
The minister’s comments come at a time when a group of ministers under the GST Council has yet to submit its final report on a rate overhaul, and a major rejig of the rates are seen to be unlikely before next year’s general elections.
In the first seven months of FY24, the average monthly GST mop-up stood at Rs 1.7 trillion, which is 11% higher than the corresponding period of last year. Analysts believe the buoyancy in tax collections this year will likely lead to actual GST collections surpassing the Budget estimates. Central GST collections in April-September rose 16.6% year-on-year to Rs 3.98 trillion, which is higher than the 12.9% growth assumed in the Budget.
Further, the finance minister said that, “from now I would want equal attention to be given to the collection of tax—the numbers are going up every month—but equally more establishments and businesses should get enrolled. The country should benefit from having a transparent tax regime in which everybody participates.”
Source:financialexpress.com