According to the data released on August 1, India’s goods and services tax (GST) revenue increased by 10.3% to reach a three-month high of Rs 1.82 lakh crore in July 2024, compared to Rs 1.74 lakh crore in the prior month. The figures for the previous month were surpassed, but they fell short of the GST collection in April.

Following a decline below 10% in June, the GST growth has now exceeded double digits.

Saurabh Agarwal, a tax partner at EY India, noted that the increase in tax collections from Nagaland, Manipur, Andaman & Nicobar, and Ladakh suggests heightened economic activity and consumption in these developing regions of India.

Collections may stagnate or reduce in August due to the impact of the monsoon season on overall economic momentum.

The recent collection figures were higher than the previous month but lower than the peak GST collection of Rs 2.1 lakh crore in April. Gross collections for the year’s first four months have seen a 10.2% increase, reaching Rs 7.39 lakh crore.

While domestic revenue grew by 8.9% in July, GST import revenue experienced a higher growth at 14.2%.

Refunds during a similar period in the previous year were 19% lower, with Rs 16,283 crore in total refunds, of which Rs 11,566 crore was for Integrated Goods and Services Tax.

Net domestic revenues stood at Rs 1.66 lakh crore, a 14.4% increase from last July’s figure of Rs 1.45 lakh crore. The government’s Budget 2024, released on July 23, predicts that GST revenues will expand by 11% in FY25.

In a recent interview with Moneycontrol, Sanjay Kumar Agarwal, chairman of the Central Board of Indirect Taxes & Customs (CBIC), pointed out that although GST tax buoyancy is expected to decline, it will remain above one.

In June, the government reconstituted a panel for rate rationalisation to submit a final report to the council recommending rate changes.

Currently, there are four GST rates—5%, 12%, 18%, and 28%—and some essential commodities are not taxed under the GST regime.

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