TMI BlogPOST COVID ECONOMIC RECOVERY AND GST COLLECTIONSX X X X Extracts X X X X X X X X Extracts X X X X ..... POST COVID ECONOMIC RECOVERY AND GST COLLECTIONS - By: - Dr. Sanjiv Agarwal - Goods and Services Tax - GST - Dated:- 3-3-2021 - - Economy India s Q3 economic numbers were released by CSO last week hinting that the Indian economy / GDP will contract by 8% in 2021-21, a little higher than the estimated contraction of 7.7%. This would mean that GDP may contract in current quarter too. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere is a recovery in private consumption in Q3. Government s capital expenditure has also increased, though operating expenditure has declined. Going by the numbers, can one say that India has exited from recession ? India s GDP has now returned to positive trajectory after Q1 and Q2 of contraction. It appears to be a V shaped recovery but we will have to wait to see if it is stable. While ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the economy grew @ 0.4% in Q3, it had grown @3.3% in Q3 of financial year 2020. The Covid-19 effect begin from March, 2020 end. A positive rate, howsoever small, is a valid reason for optimism in times to come. Recently, though RBI has expressed a view that India s economic activity is gaining momentum, but it is surrounded by the uncertainty owing to recent surge in Covid infections. Infact, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RBI in its Report on State of Economy , states that all engines of aggregate demand are starting to fire; only private investment is missing in action and the time is apposite for it to come alive. Broader measures of liquidity reflect the easing of monetary and financial conditions in the system. This was possible with businesses, offices and shops reopening. Once consumption revives, recover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y will sustain. GST Central Government has extended the due date for filing GST annual return in Forms 9 and 9C from 28.02.2021 to 31.03.2021 at the fag end of last date (6 PM of 28.02.2021, Sunday) amid lost hopes. This extension is second extension, earlier one granted from 31.12.2020 to 28.02.2021. The main reason attributed for this extension has been cited as difficulties ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... faced by the taxpayers . Notification No. 3/2021-CT dated 23.02.2021 exempts certain class of persons from requirements of section 25 (6B, 6C) for the purpose of GST registration. Earlier, CBIC clarified on applicability of dynamic Quick Response Code (QR Code) on B2C invoices and related compliances by way of Circular No. 146 dated 23.02.2021. When we talk of recovery, GDP numbe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs, growth etc, the GST collections are the real encouragement to one and all. GST collections have surpassed the ₹ 1 trillion mark for the fifth consecutive month, touching ₹ 1.13 trillion in February. The robust mop-up could partially be attributed to the Governments drive against GST evaders and fake bills, apart from tightened compliance measures and overall improvement in the econ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omy. The collection reflects business transactions mainly done in January, 2021. The gross GST revenue collected in the month of February 2021 is Rs. 1,13,143 crore of which CGST is Rs. 21,092 crore, SGST is Rs. 27,273 crore, IGST is Rs. 55,253 crore (including Rs. 24,382 crore collected on import of goods) and Cess is Rs. 9,525 crore (including Rs. 660 crore collected on import of goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). In line with the trend of recovery in the GST revenues over past five months, the revenues for the month of February, 2021 are 7% higher than the GST revenues in the same month last year. During the month, revenues from import of goods was 15% higher and the revenues from domestic transaction (including import of services) are 5% higher than the revenues from these sources during the same mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nth last year. The GST revenues crossed Rs. 1 lakh fifth time in a row and crossed Rs. 1.1 lakh crore third time in a row post pandemic despite this being revenue collection of the month of February. This is a clear indication of the economic recovery and the impact of various measures taken by tax administration to improve compliance. GST collection on a monthly basis in 2021-21 has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stable, more so after the economy opened up after initial lock down due to Covid, so much so that in last five months, it has been over Rs. one lakh, viz, Month GST Collections (Rs. in crores) April, 2020 32,294 lakh May, 2020 62,009 lakh June, 2020 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 90,917 lakh July, 2020 87,422 lakh August, 2020 86,449 lakh September, 2020 95,480 lakh October, 2020 1.051 lakh November, 2020 1.049 lakh December, 2020 1.151 l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... akh January, 2021 1.198 lakh February, 2021 1.13 lakh The sustained higher collections are mainly attributable to economic recovery, increased rail freight, invoice generation, increased compliances and curbs on tax evasion. There is a growing demand of bringing petroleum products under GST net, beside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s reducing taxes and cesses thereon. There is a need to revisit indirect taxes on fuel. In fact, overall there are still 35 cesses being collected today also. Both, Chief Economic Adviser to Central Government and Reserve Bank of India have also voiced this concern. Taxes on fuel were raised twice during Covid pandemic in last one year instead of consumers benefitting from lower global prices of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oil. The Ministry of Finance is now considering to cut on taxes (excise duties) and keep the prices stable. This could be done by a consultative process between the centre and states. - - Scholarly articles for knowledge sharing authors experts professionals Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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