The all powerful GST Council may consider lowering tax on items of common consumption of the high trajectory of collections continues over the next few months, an official said today.
The first-month collection under the new Goods and Services Tax (GST) regime has been encouraging and if the rising trend continues until December, it would make a case for reduction of the tax rate, he said.
The tax reduction could be either on items of common consumption or a cut in headline rate which will benefit consumers, said the official who did not wish to be identified.
The GST Council headed by Finance Minister Arun Jaitley could look at the aspect once the clear trend is available, the official said, adding that it would be evident from the November tax collection.
India’s maiden GST revenue mop-up got off to a strong start with a collection of Rs 92,283 crore in July from just 64.42 per cent of the total taxpayer base.
Of this, as much as Rs 14,894 crore has come in from the Central GST (CGST), Rs 22,722 crore from State GST (SGST), Rs 47,469 crore from Integrated GST (IGST) and Rs 7,198 crore from compensation cess levied on demerit and luxury goods.
July was the first month from which a unified Goods and Services Tax (GST) was implemented across the country, replacing more than a dozen central and state levies like excise duty, service tax and VAT.
The collections are likely to go up further when all the tax payers file returns.
The collections were higher than the finance ministry’s internal estimate of Rs 91,000 crore.
So far, 38.38 lakh taxpayers, accounting for 64.42 per cent of the total businesses who had registered in July, have filed returns. As per the registration, 59.57 lakh businesses should file a return for July.