Lockdown causes significant drop in March GST collection
Goods and services tax collections for March fell below Rs 1 lakh crore for the first time after four consecutive months of beating that mark, as the financial effects of the lockdown become increasingly apparent.
Total GST collections for March totalled Rs 97,597 crore ($13.21 billion), which was significantly lower than the Rs 1.15 lakh crore target set by the government for the month, ET Bureau reported.
GST collections had been over Rs 1 lakh crore for the past four months but the lockdown has seen sales of all ‘non-essential’ goods halted and this drop in revenue has led to the drop in tax. February’s GST total was Rs 1.05 lakh crore.
GST revenue in March from domestic transactions decreased by 4% year-on-year. The government’s tax revenue has fallen at a time when numerous retail and trade bodies are asking for financial aid to sectors suffering from the halt in retail and production. The Gem and Jewellery Export Promotion Council, the Clothing Manufacturers Association of India, and the Confederation of All India Traders have all requested government support for their respective sectors.
“In spite of the higher target, GST collection for March 2020 is Rs 97,597 and it is lowest in the last quarter because of lower collections due to pandemic lockdown as expected,” HostBooks Limited’s chairman and founder, Kapil Rana, told Livemint.
“We will see a higher fall in GST collection in the coming months as most of the businesses are closed down. The domestic market, as well as the international market, is uncertain, so the government should be more cautious for setting the target for the next quarter.”
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