GST collections for March likely to skid amidst economic slowdown
In what might spoil the efforts of North Block to achieve budget targets, the field formations have started giving initial feelers to the revenue department for subdued Goods and Services Tax (GST) collections.
In what might spoil the efforts of North Block to achieve budget targets, the field formations have started giving initial feelers to the revenue department for subdued Goods and Services Tax (GST) collections.
Government sources told CNBC-TV18 that the field formations after doing a detailed analysis of the business activity across India have started citing to the revenue department that the upcoming GST collections for the month of February will be lower than last month. It was on March 1 when the government announced GST collections for the month of January, reported in February at Rs 1.05 lakh crore.
The GST collections are recorded with one month lag. GST collections for the month of February gets reported in March. The last day for filing of GST returns for the month of February is March 20. The government formally will release the GST collections for February on April 1, based on return filing and reporting in March.
Three major reasons have been highlighted by the field formations are due to the shift of BS-IV to BS-VI, auto manufacturers are going slow leading to a huge impact on the GST collections. Auto majors do not want an excess inventory of BS-IV and due to disruptions of supplies from China, BS-VI manufacturing has also taken a hit," sources privy to the developments told CNBC-TV18.
"Secondly, both B2B and B2C impact of delayed supplies from China on account of the coronavirus outbreak, which has lead to non-availability of products in the B2C markets. And supplies of raw materials have been hit for B2B players, which is impacting both manufacturing and sales in various industries," according to multiple people familiar with the development.
"The third being, the on-going slowdown in the overall economy, be it in exports, imports, domestic market sales leading to a decline in collections," said people familiar with the matter.
Meanwhile, it is also understood that the field formations are trying hard to keep the GST collections, at least above Rs 1 lakh crore mark, which is taken as a cut of for a decent collection number.
Sources in the know told CNBC-TV18 that on March 6, revenue secretary, who has recently been designated as finance secretary, will be chairing 3rd National Conference on GST in New Delhi.
The conference will be attended by state GST commissioners, centre chief commissioners and principal commissioners to draw the future roadmap of GST.
"The conference will discuss the roadmap of the roll-out of a new return filing system. Also deliberate on revenue augmentations measure, measures to increase compliance, measures for faster recovery of notices and pending demands amongst others," sources added.
First Published: Mar 5, 2020 4:23 PM IST
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