Maharashtra levels up its revenue with 26% after GST kicks in

Mumbai, April 2: Creating a state that has covered all positive and optimistic ideas to dwell in becoming an ideal State, Maharashtra has invited many innovative and creative ideas. Another in the row has it that Maharashtra has leveled up its revenue collection from Goods and Service tax by setting up record of 26% this year. The state received Rs1.14 lakh crore in revenue from taxes, according to data from the GST department. Sighting to the overall revenue, 31% was collected as Value Added Tax (VAT) between April and July, before the GST came into existence. It was the time when dealers were confused and gearing up for the new tax regime.

State GST Commissioner Rajiv Jalota said, “We saw a good upside in revenue in these four months as dealers were in a hurry to clear their stocks and inventories. Maharashtra being a state with a strong manufacturing sector, VAT collections were quite high.”

Between August and March which is considered as the GST period of the year, revenues increased by 30% compared to that for the same period the year before. Once GST was rolled out on July 1, new taxpayers were registered. With around 5.5 lakh additional dealers now in the tax net, the department had expected a rise in revenue this year.

“As many more taxpayers got added after the rollout of GST in July, they started adding to the revenue. In the first few months, taxpayers were more compliant and we saw a spike in collections,” said Jalota.

Collections in August 2017 were 51% higher than that in 2016. Tax collections between August and October account for almost a quarter of the total revenue collections. Jalota said that in Maharashtra the consumption of services were quite high, particularly in the entertainment, hospitality, banking and manufacturing sectors. This added to the revenue.

From November, the collections started to drop, only to pick up in January and February when the state received the Integrated Goods and Services Tax (IGST) settlement from the Centre. Maharashtra received around Rs2,300 crore in IGST settlements almost 15 per cent of the total settlements across the country. Compliance appears to have dropped gradually over the past four to five months. Official data shows that the percentage of dealers filing returns both GST R1 and GST 3B dropped steadily after October.

While 94.47% dealers in the state filed their GST 3B returns in July, by February, it has shrunk to 68.58%.