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Why Do GST Collections Reach Their Highest Level Ever In April 2023? Experts Advise This

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The goods and services tax (GST) had the highest-ever receipts in April of Rs 1.87 lakh crore, surpassing the Rs 1.75 lakh crore threshold for the first time. Growth in recent months has been stable around 11–13%. According to experts and business leaders, India's economy is expanding at a solid rate thanks to a significant uptick in consumer demand. This is shown by the all-time high indirect tax receipts.

“This phenomenal growth (in GST collections) is attributable to year-end compliances by taxpayers for 2022–23, overall growth in the economy, and the push for GST audits,” said Mahesh Jaising, partner and leader (indirect tax) at Deloitte India. Tax authorities are trying to recoup taxes utilizing hazardous taxpayer identification and data analysis.

The Finance Minister Nirmala Sitharaman this week directed CBIC to deploy automated return inspection and step up the campaign against bogus billing and input tax, he said, thus the upturn is anticipated to continue.

The highest-ever GST collection of Rs 1.87 lakh crore in April marked a great beginning of FY24, according to Ajay Singh, head of business group ASSOCHAM. The GST figures show that the Indian economy is expanding strongly because to a surge in consumer demand.

The record receipts, according to Prime Minister Narendra Modi, are “great news for the Indian economy,” he said, adding that the fact that tax collections are increasing despite reduced tax rates demonstrates the effectiveness of the GST's enhanced integration and compliance.

Stating that growth in e-way bills in March 2023 also contributed to the GST collections, Gautam Mahanti, business head at IRIS Tax Tech, said, “As anticipated, the 12 per cent growth in April 2023 from the previous year in April 2022 (Rs 1.67 lakh crore) is attributed to the rise in e-way bills generated in March 2023 (Rs 9.09 crore), which witnessed a 16 per cent growth from the same period last year (Rs 7.81 crore in March 2022).”

The record-breaking GST collection of Rs 1.87 lakh crore in April 2023, according to him, is a glaring example of the benefits of e-invoicing and tighter compliance controls, together with India's booming economy.

“While collections have maintained a healthy 11–13% growth in the recent months, a normalizing base and some cooling of inflation may moderate the pace of expansion slightly in the coming quarter, although it would remain in the high single digits,” said Aditi Nayar, chief economist and head (research & outreach) at ICRA.

Collection of GST in April 2023

GST revenues in April 2023 increased by 12% YoY to reach Rs 1,87,035 crore, which was a record high. With a total of Rs 33,196 crore, Maharashtra led all states in GST revenue, followed by Karnataka (Rs 14,593 crore), Gujarat (Rs 11,721 crore), and Uttar Pradesh (Rs 10,320 crore).

The northeastern states (Sikkim – 61%, Mizoram – 53%, Manipur – 32%, Nagaland – 29%, Tripura – 25%, Arunachal – 21%, Assam – 15%), J&K – 44%, as well as other states like Goa – 32%, Karnataka – 23%, and Maharashtra – 21%, have seen increases in collections.

Odissa and Gujarat's GST collection rise year over year of 3% and 4%, respectively, Saloni Roy, partner at Deloitte India, said was exceptional but would likely be made up in coming months.


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