Andhra Pradesh

State likely to miss GST target

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The collections come down after starting on a positive note

The State government is likely to miss the Goods and Services Tax (GST) target for the current financial year if the collections made so far are any indication. It is “likely to net about ₹23,500 crore” by the end of the financial year as against the target of ₹24,800 crore.

According to information, the financial year started on a positive note as the GST collections touched ₹2,113.54 crore. But, in the subsequent months, there was a dip. The State government, apparently, could not sustain the momentum during the first quarter of the current financial year.

The revenue was considerably good during April 2019. However, during May and June, the target could not be achieved. While ₹1,892 crore has been set as target for every month, the collections did not cross ₹1,650 crore each in May and June.

The situation improved in the last quarter, but the “overall performance by the end of the fiscal” may not be on the expected lines. There could be a gap of about 3% between the target and achievement, sources say.

The State registered a growth of 11% by netting ₹2,265 crore in December 2019 compared to ₹2,049 crore in December 2018. “Notwithstanding, there may be a shortfall of ₹1,000 crore to ₹1,500 crore by the end of the financial year,” says a senior official, who did not want to be quoted.

Reasons for shortfall

The officials cite a fall in automobile sales, steel etc. as the reasons. The steel prices witnessed a fall by 10 to 15%, while that of cement decline by about ₹20 per bag.

Though sectors such as automobiles, (more particularly two-wheelers) have improved compared to the initial four-five months, steel and iron still need to pick up.

The fall in crude oil prices, the slowdown in construction industry, falling sale of automobiles etc. are some of the reasons. “This had impacted the performance, collections, target and achievements,” says the official.

The government clocked a growth rate close to 28% (which was among the highest in big States) in the GST collections last fiscal (2018-19).

In fact, the State had set a record in the GST collections amounting to ₹20,746 crore.

Compared to 2017-18, the year of GST implementation, the State registered a growth of 27.75%. The GST collections were ₹10,826 crore for eight months in 2017-18. By the next financial year, the revenue touched ₹20,746 crore.

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Printable version | Jan 24, 2020 11:02:09 AM | https://www.thehindu.com/news/national/andhra-pradesh/state-likely-to-miss-gst-target/article30517377.ece

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