In the upcoming Union Budget 2023-24, the Centre is expected to increase its own Goods and Services Tax (GST) revenue target by 14-15 per cent, a senior government official has said.
It is expected that the government could exceed its tax collection targets for this financial year by over Rs 2 lakh crore
In the upcoming Union Budget 2023-24, the Centre is expected to increase its own Goods and Services Tax (GST) revenue target by 14-15 per cent, a senior government official has said.
“The revenue collection (GST) is showing a healthy trend. The collections have improved significantly because of the increased focus on compliance. We are hopeful that revenue collection would be robust this year and that might help us to increase our (Central GST) target for the next year by 14-15 per cent in the budget,” the official said.
In the budget documents published earlier this year, the GST collection for the present fiscal was revised upwards to Rs 6.6 lakh crore from the earlier target of Rs 5.7 lakh crore. Just last month, the government’s GST mop-up saw a 16.6 per cent year-on-year increase to Rs 1.52 lakh crore. Out of this, Rs 74,665 crore was Central GST (CGST).
October's collection was the second-highest monthly collection since GST was rolled out in July 2017. In April 2022, the GST collection had touched a record high of Rs 1.67 lakh crore. Regarding the gross GST monthly revenues, Revenue Secretary Tarun Bajaj had said earlier this week that collections are likely to average at Rs 1.4-1.5 lakh crore per month in the current financial year.
The senior government official who hinted at an increased Central GST (CGST) target next fiscal also said that robust collection would help in offsetting the increase in expenditure seen this financial year. The official added, “Both direct and indirect tax fronts are looking good at the moment. This is the momentum that was much needed in a very difficult year. Hopefully, it would continue in the next fiscal too.”
On the direct tax front, for the April 1-October 8 period, collections grew 24 per cent to Rs 8.98 lakh crore. Gross corporate tax collection grew 16.74 per cent in the same period, and personal income tax collection grew 32.30 per cent. "So far as the growth rate for corporate income tax (CIT) and personal income tax (PIT) in terms of gross revenue collection is concerned, the growth rate for CIT is 16.73 per cent, while that for PIT (including STT) is 32.30 per cent," the Central Board of Direct Taxes (CBDT) had said in October.
It is being expected that the government could exceed its tax collection targets for this financial year by over Rs 2 lakh crore. Robust revenue receipts have kept the government’s hope alive to contain fiscal deficit within 6.4 per cent of gross domestic product. Rising subsidy bill had sent alarm bells ringing about breeching fiscal deficit target this year, which now seems possible with healthy tax mop up.
On the GST regulation front, presently, the government is working on a definitive way to tax online gaming portals. The GST law does not provide any clear-cut definition of online gaming and hence, deciding what constitutes ‘game of chance’ and ‘game of skill’ has been a challenge before the GST council. As per existing laws, games of chance attract 28 per cent GST, whereas online games of skill, like fantasy sports or rummy, attract an 18 per cent tax rate. The ministerial panel that was set up to decide the tax rate for online gaming, is expected to recommend the earlier proposed uniform 28 per cent tax rate for online games, casinos, and race courses.