Fall in Goods And Services Tax (GST) Collections – Economics

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CURRENT AFFAIR

Goods and Services Tax (GST) collections for March 2020 stood at ₹97,597 crore, dropping below the ₹1 lakh-crore mark after four months.
GST Collected
Of the total collections, central GST stood at ₹19,183 crore, State GST was at ₹25,601 crore and integrated GST atwas ₹44,508 crore.
The government had settled ₹19,718 crore to CGST and ₹14,915 crore to SGST from IGST as regular settlement.
In addition, the Centre also apportioned unsettled balance IGST of ₹6,000 crore on an ad-hoc basis in a 50:50 ratio between the Centre and States.
Partial Impact of COVID-19:
The March revenue collections are based on the business conducted in February.
The collections do not take into account the full impact of COVID-19 and the consequent shutdown of many business sectors in India.
It has been warned that the revenues for the month of April 2020 are likely to dip much further.
In Comparison to March 2019
According to the Ministry of Finance, Gross GST revenue for March 2020 was 8% lower than that of March 2019.
Fall in Collection from Imports
Although GST revenue from domestic transactions dropped 4% in comparison with March 2019, there was a 23% fall in the tax collected on import of goods.
Global trade was affected by COVID-19 in February itself.
Step Taken
Small businesses have been allowed a three-month deferment of GST payments due to the COVID-19 situation.
There is a wider industry demand for a moratorium on payments and reduction in rates.

GST is a comprehensive, multi-stage, destination-based tax that is levied on every value addition.
GST is a comprehensive Indirect Tax which has replaced many Indirect Taxes in India.
Under the GST council and 101st constitutional amendment, the tax is levied at every point of sale.
GST is categorized into CGST, SGST or IGST depending on whether the transaction is Intra-State or Inter-State.

It is the 1st Federal Institution of India, as per the Finance minister.
It will approve all decision related to taxation in the country.
It consists of Centre, 29 states, Delhi and Puducherry.
Centre has 1/3rd voting rights and states have 2/3rd voting rights.
Decisions are taken after a majority in the council.
Intra-State supply of goods or services is when the location of the supplier and the place of supply i.e., location of the buyer are in the same state. In Intra-State transactions, a seller has to collect both CGST and SGST from the buyer. The CGST gets deposited with Central Government and SGST gets deposited with State Government.
Inter-State supply of goods or services is when the location of the supplier and the place of supply are in different states. Also, in cases of export or import of goods or services or when the supply of goods or services is made to or by a SEZ unit, the transaction is assumed to be Inter-State. In an Inter-State transaction, a seller has to collect IGST from the buyer.