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GST collections up 4.5% MoM in Sep’21

Average monthly collections strong at INR1.14t

* Total gross Goods & Services Tax (GST) collections grew 4.5% MoM to INR1.17t in Sep’21. Total GST collections during Apr–Sep’21 stood at INR6.8t, 54.1% of FY22BE. This was higher than INR4.5t (or 32.6% of FY21BE) achieved during the corresponding months in 2020.

* On a yearly basis, GST collections grew 22.5% YoY in Sep’21, against a growth of 29.6% YoY in Aug’21 and modest growth of 3.9% YoY in Sep’20.

* Within the total GST collections in Sep’21, CGST collections amounted to INR205.8b and SGST collections to INR267.7b. GST collections on imports / domestic activity expanded 31.7%/19.7% YoY to INR295.6b/INR874.6b in Sep’21.

* Additionally, daily e-way bill generation in Sep’21 stood at 2.2m units (up to 26th Sep’21), similar to Aug’21 and far higher than the average 1.8m average daily e-way bills generated during Apr–Jul’21.

* Overall, average monthly GST collections stood at INR1.14t in 1HFY22. This indicates the government needs only INR0.96t in average monthly collections in 2HFY22 to achieve its FY22 budget target (full-year target of INR12.6t, of which INR6.8t has been collected). Assuming continued momentum in economic activity, we believe the monthly average could be in the range of INR1.10–1.11t in FY22E. If so, we could see excess collections of ~INR600b in FY22E on the GST front this year.

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