Collections from the nationwide sales tax rose 10 percent to 1.13 trillion rupees ($16 billion) in April from a year ago, official data show. While that was the closest to the 1.15 trillion rupees monthly target set by Prime Minister Narendra Modi’s administration, it’s still not enough to bridge the government’s budget gap, say economists. “If GST collections do not improve further and sustain, the pressure on the central government’s fiscal position will continue," economists Suvodeep Rakshit and Upasna Bhardwaj at Kotak Mahindra Bank wrote in a note. The government had touted GST as a tool to increase tax compliance when it was introduced in July 2017. Collections under the new tax have crossed the 1 trillion rupee-mark in three of the first four months in 2019, suggesting it’s gaining traction.

Source: Mint May 06, 2019 22:41 UTC