In another setback to the Indian economy, the GST collections for August fell to a 19-month low at Rs 91,916. The latest depressing development concerning the Indian economy came just weeks after the latest GDP data for the first quarter of the 2019-20 financial year showed that the Indian economy had shrunk to 5%.
A statement by the government, as quoted by news agency PTI, read, “The revenue during September 2019 declined by 2.67 percent in comparison to the revenue during September 2018. During April-September, 2019 vis-a-vis 2018, the domestic component has grown by 7.82 percent while the GST on imports has shown negative growth and the total collection has grown by 4.90 percent.”
Analysts believe that the fall in the monthly GST collections in August chimed well with the current slowdown in the economy triggered by shrinking consumer demand. A report by news agency PTI said that the tax collections at Rs 91,916 crore for August was lower than Rs 98,202 crore collected for July and Rs 94,442 crore mop-up in the same month a year ago.
Of the total collections made for August, Rs 16,630 crore came through Central-GST (CGST), Rs 22,598 crore in State-GST and Rs 45,069 crore through Integrated-GST (IGST). As much as Rs 7,620 crore was collected as cess levied on luxury and sin goods.
Reviving the economy has become a huge task for the Centre’s Narendra Modi government. Finance Minister Nirmala Sitharaman has made several announcements including tax bonanza to corporates, but nothing appears to be helping the revival of the economy. The tax cut announced for India’s big businesses would cost the Indian government a whopping Rs 1.45 lakh crore.