GST collections up 7.4% YoY in Feb’21
* Goods and Service Tax (GST) collections grew at 7.4% YoY, the slowest pace in three months, to INR1.13t in Feb’21 (v/s 8.1% YoY growth seen in Jan’21). However, collections contracted 5.6% MoM in Feb’21 vis-à-vis 4.1% MoM a month ago.
* With this, the total GST collections over Apr’20–Feb’21 stood at INR10.13t, implying a contraction of 9.9% YoY.
* The government has now collected ~98% of the revised target of INR10.3t for FY21RE – the central government revised its GST revenue target from INR13.8t (FY21BE) to INR10.3t (FY21RE) in the Union Budget 2021–22.
* Of the total GST collections in Feb’21, CGST amounted to INR210.9b, SGST to INR272.7b, and IGST to INR552.5b. Moreover, GST collections on imports rose an impressive 17.5% YoY to INR243.8b in Feb’21, implying pure domestic collections of INR887.6b (growth of 4.9% YoY) during the month.
* Additionally, daily e-way bill generation in Feb’21 (up to 21st Feb’21) stood at 2.2m units, the highest over the past two years at least (since e-way bill generation data has been made available), implying a continuous uptick in economic activity.
* GST revenues in Feb’21 exceeded INR1t for the fifth time in a row, implying persistent improvement in economic activity. Overall, the government now needs only ~INR170b to achieve its FY21RE of INR10.3t. Assuming the momentum in GST collections continues in Mar’21 as well and the government is able to collect another INR1t this month, it would overachieve its GST target by nearly INR850b (or 0.4% of GDP). This would certainly bring some relief to the highly stretched fiscal accounts of the central government.
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