GST mop-up for October down Rs11,785 cr at Rs83,346 cr

Total revenue collection under the goods and services tax (GST) for October 2017 (till 27 November) stood at Rs83,346 crore, down Rs11,785 crore compared to the Rs95,131 crore collected in the previous month. 

About 5.01 million from among the 9.59 million registered taxpayers have filed GST returns for October till 26 November, figures released by the finance ministry showed.

Of the 9.59 million registered taxpayers 1.51 million are composition dealers who are required to file returns every quarter, according to the ministry release.

The total number of GSTR 3B returns filed for the return period July, August, September and October 2017 (till 26 November) stood at 5.87 million, 5.89 million,  5.73 million and 5.01 million, respectively.

States have collected a total of Rs87,238 crore by way of SGST in August, September, October and November 2017 (till 27 November). Further, on all inter-state trade, a net amount is transferred from IGST account to the SGST account whenever IGST collected is used for payment of SGST. The centre has released an amount of Rs31,823 crore to the states by way of settlement for August, September and October 2017 and another Rs13,882 crore for November 2017. 

Further, as per the Goods and Services (Compensation to States) Act 2017, the states' revenues are fully protected against any shortfall in GST collections.

A compensation amount of Rs10,806 crore has been released to all the states for the months of July and August 2017 and is in the centre is in the process of releasing Rs13,695 crore for September and October 2017.

The states' revenues have thus been fully protected taking base year revenue as 2015-16 and providing for a projected revenue growth rate of 14 per cent, according to the union finance ministry.

Total CGST income of the centre for August, September, October and November (till 27 November) stood at Rs58,556 crore. In addition to this, an amount of Rs16,233 crore has been transferred from IGST account to CGST account by way of settlement of funds on account of inter-state supply of goods and services in August, September and October 2017.  Further, Rs10,145 crore is being transferred to CGST account from IGST account for the month of November 2017 by way of settlement.

The fall in receipts of CGST and SGST has been attributed to use of transition credit rather than cash for discharging CGST liability. Taxpayers are using the balance credit available with them in the previous tax regime, which is the reason why there is an additional revenue gap in the centre's revenue.

Besides, the first time requirement of paying IGST on transfer of goods from one state to another state even within the same company involved an additional cash flow of IGST in the first 3 months. As and when the final transaction of these goods takes place, the credit for IGST is being utilised for payment of SGST and CGST and therefore, the inflow of new taxes is low.

Since the overall incidence of taxes on most of the commodities has come down under GST, it would naturally have some implication on the revenues of the government.

Also, the administration of GST is now based on self-declared tax return, in which the assessee decides the tax liability on his own and claims input tax credit as per his own calculations.

Since implementation of some of the main features of GST such as matching of returns, e-way bill as well as reverse charge mechanism have been postponed the tax compliance may not be up to the mark, it added.