GST collections remain strong, but faster import growth needs watching: Tax experts
India's GST collections remained strong, rising to Rs 2.04 lakh crore in September, however experts express concern over the wide gap in tax revenue from imports and domestic transactions. They say that the divergence suggested that imports were contributing significantly to the overall growth in collections. The trend could warrant a reassessment of some production-linked incentive schemes to…
New Delhi witnessed strong GST collections in September, with gross collections soaring 14.7% year-on-year to Rs 2.04 lakh crore. However, tax experts have noted that the sharp contrast between import and domestic transaction growth warrants close monitoring. While domestic GST revenue grew 10.1%, revenue from imports surged 25.9%, indicating imports played a significant role in the overall revenue surge.
PricewaterhouseCoopers partner Pratik Jain highlighted this divergence, stating that imports contribute significantly to the overall growth in collections. Saurabh Agarwal, Tax Partner at EY India, emphasized that the faster growth in import GST is a key trend to watch. He pointed out that while overall collections reflect continued demand strength, the import numbers are worth attention.
Agarwal noted that India's gross GST collections crossing the Rs 2 lakh crore mark demonstrates that domestic demand remains robust. However, he suggested that sustained growth in domestic revenues will be crucial to watch. Tax Connect Advisory Services LLP's Vivek Jalan echoed similar sentiments, calling September a strong month for GST collections with net revenue rising 18.1% to Rs 1.77 lakh crore.
However, he flagged a 13.5% decline in domestic refunds, urging close monitoring to ensure business liquidity. Overall, experts view September's GST numbers as a sign of continued resilience, with fast-growing imports and declining refunds as key indicators to watch in the coming months.
Written by urgent.news from The Economic Times - Economy's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
