Even as the economic slowdown is expected to impact goods and services tax (GST) collection, there is no need to panic, said tax experts. The need of the hour is stability, not more turbulence, Pratik Jain, partner, PwC India told CNBC TV-18. Even increasing the compensation cess may not be the best decision to raise revenues and compensate for the shortfall, he added. GST collection in November dropped to Rs 97,637 crore, lower than Rs 1 lakh crore collected previous month. Of the Rs 97,637 crore collected, central GST (CGST) collection is Rs 16,812 crore, state GST (SGST) is Rs 23,070 crore, integrated GST (IGST) is Rs 49,726 crore (including Rs 24,133 crore collected on imports) and cess is Rs 8,031 crore.
Taking stock of the matter, M S Mani, Partner at Deloitte India, said that the government must find ways to plug the cases of input tax credit (ITC) evasion coming forward. On slowing GST collection, he told CNBC TV-18 that since GST is a transaction-based tax, there will not be a lag between slowdown and tax collection.
Meanwhile, the taxpayers find making amendments and corrections to goods and services tax (GST) returns as the most challenging task, revenue secretary Ajay Bhushan Pandey said at a marathon meeting with tax practitioners on Saturday, also attended by finance minister Nirmala Sitharaman. Traders association, representatives from the MSME sector and a senior chartered accountant also attended the meet. Each group filed different returns (GSTR 3B, 1 and 9, among others) to demonstrate the shortcomings to the minister on a real-time basis.
The tax came into effect from July 1, 2017 through the implementation of One Hundred and First Amendment of the constitution by the government. The tax replaced existing multiple flowing taxes levied by the central and state governments.