The average monthly collection of GST is expected to reach ₹1.6-lakh crore or even more in FY24, Budget data showed. Based on RE, it is around ₹1.4-lakh crore during FY23.

According to the experts, going by the current trend, coupled with coordinated policy action, even higher collections are possible. The Budget has estimated collection through CGST (Central Goods & Services Tax) including Compensation Cess for the entire FY24 at ₹9.6-lakh crore — 12 percent higher than the revised estimate of FY23 which is ₹8.5-lakh crore. Extrapolating both the estimates for SGST (State Goods & Service Tax), the average monthly collection to achieve the FY24 target can be pegged at ₹1.6-lakh crore against ₹1.4-lakh crore for FY23 (RE). During FY23, GST collection in the first 10 months was encouraging with the all-time high monthly collection touching ₹1.68-lakh crore in April and a second all-time high of ₹1.56-lakh crore in January. So far, in the first ten months, the average monthly gross collection has been ₹1.49-lakh crore, higher than the requirement of achieving a revised estimate in FY23. Three factors — recovery in the economy, expansion of tax base, and improvement — contribute to the better collection. In the Oct-Dec 2022 quarter, a total of 2.42 crore GST returns were filed compared with 2.19 crore in the same quarter last year. Similarly, the percentage of filing of GST returns (GSTR-3B) and the statement of invoices (GSTR-1), till the end of January reached 89.5 and 87.3 percent, respectively against 77 and 59.2 in FY20.

Harpreet Singh, Partner with KPMG India, felt an increase in spending by the middle class, supply chain efficiencies, adoption of digital payments, seamless tracking of transactions through e-invoice and e-way Bill reporting, etc are some of the key factors contributing to better tax collections.  On what the government should do to accelerate the pace of collection, Singh said that consolidation of tax slabs to achieve fewer rates, lesser compliances by merging two monthly returns into one, use of data analytics under the ADVAIT project to study tax trends for assistance in GST Audits, etc. are some of the key initiatives that can result in increased tax base and resultant higher tax collections.