In what seems to be a positive development for the Indian economy, the Goods and Services Tax (GST) collection figures crossed Rs 1 lakh crore for the second consecutive month.

The total collection of GST revenue in December has come at Rs 1.03 lakh crore, which is almost nine per cent more in comparison to the amount collected in the same month a year ago.

CGST (Central GST) collection amounted to Rs 19, 962 crore while SGST (State GST) and IGST (Integrated GST were recorded at Rs 26,792 crore and 48,099 crore respectively. Meanwhile, cess for the month of December stood at Rs 8,331 crore.

This is also in line with the government's goal of collecting over Rs 1 lakh crore GST for the remaining months of 2019. The development comes as a relief for the finance ministry and government considering the dampened state of economy.

While higher collections will help in reducing the fiscal deficit, the bigger development here is a possible boost in consumption activities in the last two months.

Higher GST collections for two straight months also signal better performance by core sectors and key industries during the period. This is also an indication that some of the key sectors including auto will report better numbers in November, following a prolonged period of contraction.

The GST collection in November and December also indicates that the worst period of India's economic slowdown may have passed.

Although there are several gaps that need to be addressed, higher collection of taxes is one reason to believe that the economic situation is likely to gradually improve in the next few months.

In a statement, the "The GST revenue during the month of December 2019 from domestic transactions has shown an impressive growth of 16 per cent over the revenue during the month of December 2018," an official statement said.

It is worth mentioning that the government has set an ambitious target of Rs 1.1 lakh crore monthly GST collection for the remaining part of the fiscal and asked taxmen to up the ante.

All eyes will be on the collections in the last few months of the current financial year as it would provide a clear insight into whether the economy is bouncing back after a prolonged period of slowdown.

 

Source : India Today