GST collections hit Rs 1.78 lakh crore in March, second highest since roll-out

GST collections in March grew 11.5 per cent to Rs 1.78 lakh crore, buoyed by domestic transactions, the finance ministry said on Monday. The highest-ever GST collection was recorded at Rs 1.87 lakh crore in April 2023.

GST collections in March grew 11.5 per cent to Rs 1.78 lakh crore on higher domestic sales, the finance ministry said on Monday.

The gross GST collection for the last fiscal (April 2023-March 2024) stood at Rs 20.18 lakh crore, 11.7 per cent higher than the mop-up in the preceding fiscal.

The average monthly gross collection for FY24 stood at Rs 1.68 lakh crore, exceeding Rs 1.5 lakh crore in the preceding fiscal.

"Gross Good and Services Tax (GST) revenue for March 2024 witnessed the second highest collection ever at Rs 1.78 lakh crore, with a 11.5 per cent year-on-year growth. This surge was driven by a significant rise in GST collection from domestic transactions at 17.6 per cent," the ministry said in a statement.

The highest-ever GST collection was recorded at Rs 1.87 lakh crore in April 2023.

Experts said the double-digit increase in monthly GST collection underscores the resilience of economy and paves way for next generation GST reforms.

The ministry said GST collections have shown "strong consistent performance" in 2023-24 and the fiscal ended March 31 marks a "milestone" with total gross GST collection of Rs 20.18 lakh crore, a 11.7 per cent increase compared to the previous year.

GST revenue net of refunds as of March 2024 is Rs 18.01 lakh crore, which is a growth of 13.4 per cent over the same period a year ago.

During the just-concluded fiscal, Central (GST) collection was Rs 3.76 lakh crore, State GST was Rs 4.71 lakh crore; Integrated GST was 10.27 lakh crore, including Rs 4.83 lakh crore collected on imported goods.

Cess collection was Rs 1.44 lakh crore, including Rs 11,915 crore collected on imported goods.

ICRA Chief Economist Aditi Nayar said, with a continued double-digit growth, the CGST collections have exceeded the FY2024 RE, even as there is a modest shortfall in the GST compensation cess inflows.

"With the CGST collections surpassing the FY2024 RE, the implicit growth needed to meet the Interim Budget Estimate for FY2025 has come down to single-digits," Nayar said.

PwC India Partner Pratik Jain said with the double-digit growth in monthly GST collections over last year, it will not be surprising if the target for FY25 is revised when the main Union Budget is presented after the formation of the new government.

"Also, the collections, which are only likely to be better in coming months, may pave the way for next wave of GST reforms including rate rationalization," Jain added.

Deloitte India Partner MS Mani said record collections during FY24 demonstrate the economic resurgence across sectors and was possible due to the various measures taken by the GST authorities to improve compliance and stamp out evasion.

"The big focus on comparison of taxpayer behaviour across tax and corporate databases has also made business convinced on the need to be compliant not only on their activities, but also keep track of their vendors tax behaviour and ensure that the entire value chain becomes compliant," Mani added.