According to official data, the integrated GST collection from imports was Rs 34,972 crore in April 2023 as against Rs 36,705 crore in April 2022.
Even as gross Goods and Services Tax (GST) collection touched a record high of Rs 1.87 trillion in April, the mop-up from integrated GST on imports declined by 4.7% on year in the month, owing to contraction in imports, falling global commodity prices and the glitches in the Customs duty payments on the Electronic Cash Ledger portal.
According to official data, the integrated GST collection from imports was Rs 34,972 crore in april 2023 as against Rs 36,705 crore in April 2022. The cess collected from import of goods was slightly higher at Rs 901 crore in April 2023 as against Rs 857 crore a year ago. Integrated GST collections from imports in March and February 2023 was also higher at Rs 42,503 crore and Rs 35,689 crore, respectively.
Possible reasons for this decline could be lower commodity prices in the international markets, and lower imports, as well as teething problems on the ECL portal, due to which some shipments may spill over to May,” said Ajai Sahai, DG and CEO, Federation of Indian Export Organisations.
April GST collections mostly pertain to transactions conducted in March. Merchandise imports in March declined by nearly 8% year-on-year to $58.11 billion in the month. Since the bill of entry is filed on the day of the import, a lower integrated GST on imports could suggest further compression in imports.
Sacchidananda Mukherjee, professor, NIPFP further said that lower international prices in goods and services are likely to have impacted integrated GST from imports.
Experts and officials, however, expect that the new normal for overall monthly GST collections will now be in the range of `1.5 trillion to Rs 1.6 trillion with a recovery in economic activities and better compliance.
MS Mani, Partner, Deloitte India said, “Since the broad macro economic parameters are moving in the right direction, and GST collections are intricately linked to the performance of various sectors if the economy, there would be an expectation of a new normal of GST collections exceeding Rs 1.5 trillion every month in FY24.”
The Central Board of Indirect Taxes and Customs is working on increased use of data analytics to widen the GST taxpayer base. Finance minister Nirmala Sitharaman has also asked the CBIC to introduce the automated GST return scrutiny by this week and to implement an action plan to increase the taxpayer base through enhanced use of technology.
Mukherjee said that going forward, GST collection is likely to moderate from the April level. “Though compliance gap may be reducing, policy gap persists. So we need to increase tax base by rate restructuring and reducing list of items under exempted list. April collections saw a significant rise due to three reasons – year end increase in tax returns (filing of pending returns for earlier months), increase in tax compliance and inflation. Use of information backed targeted intervention in tax administration is responsible for improvement in tax compliance,” he further noted.
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